Tesla’s market position is under serious threat as CEO Elon Musk’s political activities drive away the company’s most loyal customers, according to marketing professor Scott Galloway. Speaking on the Pivot podcast, Galloway described Musk’s involvement with the Trump administration as “one of the greatest brand destructions” in recent business history.
The impact on Tesla has been swift and severe. The company’s brand reputation has collapsed from 8th to 95th place, while sales across Europe show dramatic declines. These market losses have translated directly to Tesla’s bottom line, with the company reporting a 71% drop in profits.
Galloway highlighted the fundamental strategic error in Musk’s approach: “He’s alienated the wrong people.” By embracing a political base where three-quarters of supporters have no interest in electric vehicles, Musk has pushed away the environmentally-conscious consumers who traditionally favored Tesla.
The situation has been exacerbated by Musk’s political commentary on European issues through his platform X, further damaging Tesla’s standing in key markets. His interventions in German politics and UK social issues have alienated potential customers in regions crucial to Tesla’s global strategy.
Facing mounting pressure, Musk recently announced he would reduce his involvement with the Department of Government Efficiency (DOGE), attributing his decision to having largely completed his government financial reform efforts.