Recently, Tesla was caught in a dilemma caused by the trade war started by President Donald Trump. Tesla reported its earnings on Tuesday. Mr. Musk will be taking questions from investors. But in this meeting, he will face a Catch-22: If Musk keeps his close relationship with President Donald Trump, the company could estrange potential customers, both internationally and at home, on who loathes Trump’s policies. If he spaced himself from Trump, then he might risk the fury of the white house. It’s an overlooked collison. The first quarter saw the company’s biggest drop in sales after effectively nonstop double-digit sales growth.
The manufacturer’s finances are only part of what investors really want to know. The investors are curious on how much the Trump administration’s 25% tariffs for all imported vehicles are really costing Tesla and what Elon Musk thinks about them. One of the biggest questions is when Musk plans to back away from the Department of Government Efficiency, in Washington state, or DOGE and continue focusing on the issues at Tesla. The people have been very patient to see the progress of self-driving cars, a cheaper new Tesla model, a Robotaxi fleet and some plans to sell humanoid robots.
On reassuring some responses for any of these main topics it’s possible that it could help reverse the slide that has really wiped out about half of the Tesla’s as they shared values since mid-December and mostly perhaps reinstate some
confidence in the company. Analyst of Wedbush Securities and longtime Tesla bull, Dan Ives recently slashed his price target for shares on Tesla, on the authority of Musk he said he is facing a “code red situation” if he keeps continuing his prominent role in the Trump administration.
Blaming brand damage for falling sales, it was said in a note by Ives on Sunday that was sent to a client that Elon needs to leave the Government immediately, take a significant step back on DOGE, and would get back to being the CEO of Tesla continually. On the further side of the Musk backlash, another thing that Tesla is facing is growing competition from some other EV manufacturers, including China. There is some bad news on any of these fronts that might cause a new downward spiral for the shares
It is confirmed the Ives told CNN that “it’s turned into a nightmare for Tesla and for the investors. The tariffs, the brand damage and the DOGE controversies. It was a perfect storm. On the other hand, Tesla has been less exposed than other automakers to Donald Trump’s auto tariffs. It doesn’t import vehicles from its 2 overseas factories, and it also uses fewer foreign parts in its U.S. built vehicles than any other auto manufacturers. Some of the other major auto manufacturers have at least some imported vehicles in their American dealerships. It stopped taking new orders in China for its higher-priced Model X & Model S cars, which were both made in California, due to China’s 125% avenging tariffs, but those models are only a very small fraction of its all-inclusive sales.
