“His rhetoric has made Tesla toxic”: Is Elon Musk alienating his target market?

myIon Musk has long flirted with right-wing politics and revels in promoting an image of himself as a showman undaunted by opposition. In recent months, however, the billionaire’s political allegiances have begun to pose a question for Tesla, the company he built into the world’s largest electric carmaker: How far can he go before customers start abandoning his products?

German pharmacy chain Rossmann was one of the first to make the jump this week. The family-owned company announced it would not add any more Tesla vehicles to the 34 it has in its fleet due to Musk’s support for Donald Trump as US president.

“Trump has repeatedly called climate change a hoax,” wrote Raoul Roßmann, a spokesman 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 incendiary posts about far-right unrest in the U.K. “Civil war is inevitable,” he posted on X, the social network formerly known as Twitter that he bought for $44 billion in 2022. That drew condemnation from politicians on the left and right in the U.K. Musk has also engaged with posts by Tommy Robinson, boosting the visibility of the founder of one British far-right group, and on Thursday posted fake news from the co-leader of another, Britain First.

For some Tesla drivers, Musk’s recent change has added an unwanted dimension to their decision about which car to drive.

“I love my Tesla,” said one senior TV industry executive. “It’s a fantastic car to drive and I really like it. The brand has always looked to the future and that’s something to be proud of.”

Now, however, “you’re clearly aligning yourself with someone who has some pretty horrible views” by buying a Tesla, he said. The executive said he canceled his order for a new Tesla, which he had placed through a leasing company.

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

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

“Given the divisive nature of Mr. Musk’s comments and his apparent pleasure in stoking such discord, we have decided that when our leases expire, we will no longer be a Tesla customer.”

Tesla has been contacted for comment.

On Tesla’s online forums, car owners debate whether Musk’s policies have hurt the brand. Bumper stickers can be purchased online with slogans like: “I bought this before we knew Elon was crazy.”

David Bach, a professor of strategy and political economy at IMD, a business school based in Lausanne, Switzerland, said Musk is not the first chief executive to start speaking openly about 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. “Typically, there is some alignment with the interests of the company, or the employees, or the customers. Elon Musk doesn’t seem to be doing that.”

Tesla has sold 23,000 cars in the UK in the first half of this year and X is also one of the most popular social networks in the country. However, in terms of the proportion of its global business, the UK is relatively small: 5% of Tesla sales and around 8% of X users, according to industry estimates.

Musk’s political interventions in the United States could have further consequences. He backed Trump after last month’s failed assassination attempt and has since regularly posted messages of support for Republicans. On Wednesday, he said Democratic presidential candidate Kamala Harris was “literally a communist.”

Trump is not a clear ally of the head of the world’s largest electric carmaker. Trump has relentlessly mocked electric cars, though he appeared to change his stance last weekend, citing Musk’s support. In local Ohio media, Trump’s running mate JD Vance has criticized electric vehicle subsidies that benefit Tesla.

Michael Tesler, a political science professor at the University of California, Irvine, noted that polls show American Democrats oppose Musk far more than Republicans, even though the latter are much less likely to buy electric cars.

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

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

“I’m a Maga and I plan on buying multiple Teslas for my family,” one X user posted last month in response to another’s vow not to buy one.

In a sign of Tesla’s embrace by right-wingers, Trump received a Tesla Cybertruck from an influencer on Monday. The truck bore his slogan “Make America great again” and the viral photo of him raising his fist after the assassination attempt.

Some people in the auto industry who deal directly with Tesla are unwilling to be quoted for fear of professional consequences and drawing the ire of Musk’s legion of supporters on social media. But for the most part they don’t believe Musk’s political statements will result in a major drop in Tesla sales.

“It draws attention and takes up mental space,” said one analyst at an investment bank who covers Tesla. But reputational damage has not been a factor in forecasting so far, the analyst added.

A former executive at a major UK car dealership said there would likely be a backlash against Musk in Britain, but not necessarily against Tesla.

“Do I think this will hurt sales? No,” the executive said.

This is confirmed by data from Auto Trader, a UK car buying platform. Despite Musk’s comments, Tesla remains the most popular used electric car brand in the UK, accounting for 21% of all deals.

Ian Plummer, commercial director at Auto Trader, said: “For most consumers, the news surrounding car brands is irrelevant. They simply evaluate cars based on what best suits their needs and budget.”

Reputational effects could also be masked by a broader weakening in auto sales caused by slowing economies and higher interest rates, as well as increased competition, particularly from Chinese rivals. Tesla’s sales fell in the second quarter of the year compared with the same period last year, and its market valuation has taken a hit amid the broader tech sector slump.

Tesla’s reputation among consumers, however, appears to be suffering. Regular surveys by market research firm Caliber show a clear decline since January 2022 in the confidence of American consumers who say they trust or like Tesla, and who say they would consider buying one. Caliber has previously attributed the decline, at least in part, to polarizing opinions about Musk.

And Musk’s actions have already had a negative effect on X, whose customers are businesses, often highly reputation-sensitive. Musk said this week that he had launched a “war” against advertisers who had abandoned X over concerns that its products were appearing alongside harmful posts.

It could also affect SpaceX, its rocket business, which periodically launches satellites for the US government.

“The advice I would give to the CEO of a company whose main client is the government is not to get involved in a contentious election campaign,” Bach said.

Antoine Argouges, the founder of Tulipshare, which has a stake in Tesla to run a shareholder activism campaign, said he believed Musk’s comments could eventually hurt Tesla.

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