Tesla's first-quarter results in 2025 have rocked Wall Street and the electric vehicle (EV) market after the "death cross" report. The EV giant posted an eye-popping 71% decline in quarterly profits and a 9% fall in revenue from the previous year, reaching $19.3 billion. It's a reality check for a company once considered the unchallenged auto market leader.
But this profit miss is not merely about business—it's about brand harm. Tesla CEO Elon Musk, increasingly tied to far-right politics and provocative government measures, is losing customers quickly.
His volatile antics and participation in the controversial Department of Government Efficiency (DOGE) during President Trump's administration are sparking concern and damaging sales.
Elon Musk's Robotaxi Hype Falls Flat
In Tuesday's downbeat earnings conference call, Musk attempted to make waves by revisiting Tesla's intentions to start fully autonomous cab rides in Austin, Texas, this June. But the twist? These "robotaxis" won't be the much-leaked Cybercab, but adapted Model Ys. Fans were expecting an innovation blast, but they were given nothing.
Autonomous driving experts predict the Cybercab, which was announced last year in late 2024, will take years or even decades to be profitable at scale. Meanwhile, the Model Y robotaxis could be insufficient to divert attention from Tesla's growing issues.
EV Sales Down Across the Board
Tesla produced just more than 336,000 vehicles in Q1, and deliveries of Model 3 and Model Y decreased by a notable 12%. The vehicle segment that features the Cybertruck decreased by a sharp 24%, which is likely because it's directly linked to Musk's more polarizing public persona.
The customers seem to be moving away from Tesla's embattled CEO. Once hailed as the innovator who would shake up the automobile sector, Musk is now in the eye of the political storm and social instability.
Carbon Credits: Tesla's Lifeline
Despite the dire financial performance, Tesla was able to generate $595 million in revenue from carbon credits—cash paid by conventional automakers to cover their emissions.
Without the credits, Tesla would have reported an operating loss, according to Gizmodo. This dependence illustrates just how tenuous the company's profitability actually is.
Protests, DOGE, and Public Distrust
Outside the boardroom, Tesla's reputation is also in jeopardy. According to the Wall Street Journal, demonstrations have erupted at Tesla showrooms across the country, spurred by Musk's leadership of DOGE—a dubious agency said to be behind cutting 280,000 government positions. Tesla buildings have even been vandalized and burned.
During the earnings call, Musk trivialized the demonstrations, stating they're "paid for" and "highly organized" but presenting no evidence.
He also announced that he would be taking a step back from DOGE after May without elaborating on what that meant. Nevertheless, Musk promised to remain engaged in government "through Trump's full term. This, however, only aggravated the public's distrust of his businesses.
Consumer Confidence Hits a Wall
What once fueled Tesla's brand—futurism, innovation, and sustainability- has now been replaced by controversy, political extremism, and broken promises. The long-anticipated $25,000 Tesla appears to be scrapped, and instead, we're left with vague ideas, unrealized Cybercabs, and ever-shifting timelines.
Musk's turn towards political clout at the expense of corporate accountability is blurring the brand that created the EV revolution.
For the consumer base, Tesla is not simply a vehicle manufacturer anymore—it's a cultural movement that people do not want to be part of.
Originally published on Tech Times
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