Tesla CEO Elon Musk has claimed, without presenting evidence, that the protests occurring at Tesla showrooms in the U.S. and Europe are the result of the Department of Government Efficiency (DOGE) actions targeting financial fraud, rather than his prominent, non-elected role in the government, as protestors have maintained. Musk suggested that the demonstrators are being paid to protest against the electric vehicle company, echoing similar claims he has made previously.
During Tesla’s first-quarter earnings call on Tuesday, Musk alleged that the protestors’ motivation is tied to the elimination of wasteful government programs they benefit from, which DOGE is curtailing. He stated that these protests are well-organized and financed, suggesting that the demonstrators would not admit the true reasons for their actions. Musk has also previously accused wealthy Democratic opponents of providing financial support to the protestors.
Some of these protests, referred to as “Tesla Takedown,” have called on Tesla shareholders to sell stock and discouraged the ownership of Tesla vehicles. The organizers of these protests describe the movement as peaceful and oppose any form of violence or property damage. They claim the protests are a response to Musk allegedly undermining global democracy, using the wealth he accumulated from Tesla.
Instances of violence have surfaced, with certain protestors resorting to throwing molotov cocktails and torching Teslas, prompting President Donald Trump to classify anti-Musk actions as “domestic terrorism.” Law enforcement recently arrested a Nevada resident for vandalizing a Tesla collision center and using incendiary devices on vehicles. The Attorney General also filed charges against individuals in other states for similar offenses.
In an interview in March with Fox News, Musk held Democrats responsible for the protests, describing their actions as irrational. However, protest organizers in Seattle have not provided comments on the situation.
Tesla is concurrently facing significant challenges with its stock price, which has fallen by 37% since the start of the year. Even longtime proponents of the company have expressed serious concerns about Musk’s role in the government and with DOGE. Analyst Dan Ives suggested that Musk should resign from his government positions and focus on his role as Tesla CEO, highlighting the brand damage that has already resulted from his current engagements.
From a financial perspective, Tesla experienced a considerable decline in profitability. Operating income decreased by 66% year-over-year to $399 million, while net income fell by 71% during the same period. Operating margins also dropped significantly. Revenue decreased 9% due to fewer vehicle deliveries, declining average selling prices, and adverse foreign exchange effects.
Nonetheless, Tesla did see positives in their energy and services revenue, which grew by 67% and 15% respectively. The company maintained a strong cash position of approximately $37 billion, a 38% increase from the previous year. Tesla attributes the financial challenges to issues like production setbacks with the Model Y, reduced selling prices, and increased operating expenses driven by AI and other projects. Despite these internal obstacles, investors remain worried about Musk’s involvement with DOGE and his political affiliations potentially impacting the company’s trajectory.
This news article was initially published on Fortune.com.
