‘His rhetoric has made Tesla toxic’: is Elon Musk driving away his target market? | Automotive industry

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‘His rhetoric has made Tesla toxic’: is Elon Musk driving away his target market? | Automotive industry

Elon Musk has long flirted with rightwing politics, and delights in pushing an image of himself as a contrarian showman. Yet in recent months the billionaire’s political allegiances have started to raise a question for Tesla, the company that he built into the world’s largest electric carmaker: just how far can he go before customers start to abandon his products?

The ******* pharmacy chain Rossmann was one of the first to put its head above the parapet this week. The family-owned company announced that it would not add to the 34 Teslas in its company fleet because of Musk’s endorsement of Donald Trump for US president.

“Trump has repeatedly called climate change a hoax,” wrote Raoul Roßmann, a spokesperson for Rossmann. “This attitude is in stark contrast to Tesla’s mission to contribute to environmental protection through the production of electric cars.”

Musk’s endorsement of Donald Trump has been followed in recent days by inflammatory posts about the far-right riots in the ***. “Civil war is inevitable,” he posted on X, the social network formerly known as

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that he bought for $44bn in 2022. That prompted condemnation from left and rightwing politicians in the ***. Musk has also engaged with posts by Tommy Robinson, boosting the visibility of the founder of a British far-right group, and on Thursday posted fake news from the co-leader of another, Britain First.

After over 30 minutes, Musk appears to have finally deleted the post

No acknowledgement yet

This was my last screen-grab, which records just under 2 million views:

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— Josh Self (@Josh_Self_)

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For some Tesla drivers, Musk’s recent shift has added an unwelcome dimension to their decision on what car to drive.

“I love my Tesla,” said a senior executive in the television industry. “It’s a brilliant car to drive and I really like it. The brand was always forward looking and something to be proud of.”

Now though, “you’re clearly aligning with someone with some pretty horrific views” by buying a Tesla, he said. The executive said he has cancelled his order for a new Tesla, which had been placed through a leasing company.

Another former Tesla customer wrote to the company directly to express outrage.

“I believe Mr Musk’s rhetoric has made the Tesla brand toxic to some, myself included,” the customer wrote, in an email copied to the Guardian.

Given the divisive nature of Mr Musk’s comments and his apparent delight in stoking such discord, we have decided that when our leases expire, we will not continue as Tesla customers.”

Tesla was approached for comment.

In Tesla online forums owners of the cars debate whether Musk’s politics have affected the brand. Bumper stickers are available for purchase online featuring slogans such as: “I bought this before we knew Elon was crazy.”

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A Tesla bumper sticker. Photograph:

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David Bach, the professor of strategy and political economy at IMD, a business school based in Lausanne, Switzerland, said that Musk is not the first chief executive to start speaking out on political issues in ways that would have been unthinkable 20 years ago. But Musk’s recent turn is different.

“In many ways Musk is a special case,” Bach said. “Usually there is some alignment with the interests of the business, or employees or customers. Elon Musk doesn’t seem to be doing that.”

Tesla has sold 23,000 cars in the *** in the first half of this year, and X is also one of the ***’s most popular social networks. Yet as a proportion of his global businesses the *** is relatively meagre: 5% of Tesla sales and about 8% of X users, according to industry estimates.

Musk’s US political interventions could be more consequential. He endorsed Trump after the ******* ************** attempt last month, and since then he has posted regularly supporting the Republicans. On Wednesday, he said the Democrat presidential candidate Kamala Harris was “quite literally a **********”.

Trump is not an obvious bedfellow for the boss of the world’s largest electric carmaker. Trump has relentlessly mocked electric cars, although he appeared to change his position last weekend, citing Musk’s support. In Ohio local media, Trump’s running mate, JD Vance, has railed against EV subsidies that benefit Tesla.

Michael Tesler, the professor of political science at University of California, Irvine, pointed to polling showing that US Democrats object to Musk much more than Republicans, even though the latter are much less likely to buy electric cars.

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“It’s unclear just how much Musk’s political alignment with Trump and other EV opponents has hurt Tesla,” the professor wrote last month in Good Authority, a political science website. “But it is inevitably bad for business when the very prominent face of an EV company is so deeply unpopular with the demographic group who is most likely to buy electric cars.”

On the other hand, for all the consumers who are put off by Musk’s political shift, some others delight in his embrace of Trump’s “make America great again” movement.

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“I’m Maga and I plan to buy several Teslas for my family,” posted one X user last month in response to a pledge by another not to buy one.

In a sign of the embrace of Tesla by rightwingers, Trump on Monday received a Tesla Cybertruck from an influencer. The truck was emblazoned with his “make America great again” slogan and the viral photo of him raising his fist after the ************** attempt.

Some people in the auto industry who deal directly with Tesla are unwilling to be quoted, for ***** of professional consequences, and of attracting the wrath of Musk’s legion of supporters on social media. But for the most part they do not believe Musk’s political statements will result in a large fall in Tesla sales.

“It gets attention and takes up mind space,” said an investment bank analyst who covers Tesla. Yet so far reputational damage has not been a factor in making forecasts, the analyst added.

One former executive at a large *** car dealer said there would probably be a backlash against Musk in Britain, but not necessarily against Tesla.

“Do I think it’s going to harm their sales? No,” the executive said.

That is backed up by data from Auto Trader, a *** car-buying platform. Despite Musk’s comments, Tesla was still the most popular used electric car brand in the ***, with 21% of all leads.

Ian Plummer, the Auto Trader commercial director, said: “For most consumers, news stories circling around car brands are irrelevant. They’re simply assessing the cars based on what best suits their needs and budget.”

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Any reputational effects could also be masked by a broader weakening in car sales caused by slowing economies and higher interest rates, plus increasing competition, particularly from ******** rivals. Tesla sales fell in the second quarter of the year compared with the same ******* last year, and its market valuation has suffered amid the wider tech rout.

Yet Tesla’s reputation among consumers does appear to be suffering. Regular polling by the market research firm Caliber shows a clear decline since January 2022 in trust from US consumers who say they trust or like Tesla, and who say they would consider buying one. Caliber has previously attributed the decline at least partly to polarised views of Musk.

And Musk’s actions have already had a negative effect on X, whose customers are businesses – often acutely sensitive to reputation. Musk this week said he had started “war” on advertisers who had abandoned X because of concerns their products would appear beside harmful posts.

It could also impact SpaceX, his rocket business, which regularly launches satellites for the US government.

“The advice you would give to the chief executive of a company whose main client is the government is not to get into the middle of a contentious election campaign,” Bach said.

Antoine Argouges, the founder of Tulipshare, which has a stake in Tesla in order to pursue a shareholder activist campaign, said that he believed that Musk’s comments could eventually harm Tesla.

Argouges acknowledged that Musk’s previous controversies appeared to have had little impact on customer loyalty. However, “at some point it’s the last straw that breaks the camel’s back,” he said.

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#rhetoric #Tesla #toxic #Elon #Musk #driving #target #market #Automotive #industry

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