He’s still the world’s richest man.
But Elon Musk’s meteoric rise as the darling of environmentalists is now a distant memory, as his struggling electric vehicle (EV) marquee Tesla sent his personal fortunes tumbling amid sagging sales and missed delivery targets.
Preliminary numbers released this week suggest Tesla sales are down 50% in Europe — 75% in Spain alone — as Musk’s personal brand takes a beating among the very same constituency that made him a multi-billionaire.
Tesla’s 2024 earnings numbers also painted a grim picture, with automotive revenue down 8% year-over-year and operating income falling 23%. The company cited falling average selling prices as a major challenge.
That sent Telsa’s shares down more than 8% on Tuesday and the stock has taken a 25% hit since the start of the year when he took on the role of US president Donald Trump’s special government waste czar.
The irony is that in 2020 Musk warned Tesla employees the company’s shares would get "hit like a soufflé under a sledge hammer" if it didn’t meet sales targets.
The slide dragged Tesla’s market valuation below the USD$1 trillion mark for the first time since November 2024, a sharp reversal from the stock’s post-election rally when investors bet on Musk’s close Trump ties to elevate the fortunes of all his companies, including Tesla.
Musk, once embraced by climate advocates as the driving force behind Tesla’s clean energy revolution, has alienated large swaths of his customer base with increasingly extreme political rhetoric and his vocal support for far-right European parties like Germany’s AfD and backing of jailed UK activist Tommy Robinson.
Investment analysts suggest that while increased competition from Chinese automakers like BYD is squeezing Tesla‘s margins, Musk’s political interventions are also playing a role.
“There’s a growing segment of consumers who no longer see Tesla as a progressive brand but rather as an extension of Musk’s controversial persona,” said AJ Bell investment director Russ Mould.
In Musk’s defence, Tesla’s European sales slump comes amid broader turbulence in the EV industry as traditional automakers like Mercedes, Volkswagen and Ford struggle to implement production lines and delay sales targets.
Adding to the pressure are Trump’s proposed tariffs on EV imports from Canada and Mexico in addition to China — all key regions in Tesla’s global supply chain. Despite Musk’s alignment Trump, the president has repeatedly criticized EV mandates and vowed to dismantle federal incentives supporting the industry.
Meanwhile, Tesla’s product pipeline is showing cracks. The much-hyped Cybertruck has been plagued by production delays and quality issues, while a lack of fresh consumer models is weighing on demand.
Tesla’s attempt to roll out self-driving technology also failed to meet expectations, leaving the company vulnerable to competition from more advanced offerings by local rivals.
Despite the setbacks, some investors remain bullish, betting on Tesla’s upcoming robo-taxi service and a new affordable EV model to revive sales.
“Tesla’s superior products and autonomy innovations still have long-term potential,” said investor Gary Black.
