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Last Updated on: 24th April 2025, 10:39 am
Elon Musk and Donald Trump may have gotten together out of a hate for trans people, labor unions, and taxes on billionaires, but, as predicted many times, Musk may regret throwing his weight behind a multi-bankrupted con man from Queens who was born with a golden spoon in his mouth and never earned his billions.
First of all, there’s still the matter of EV tax credits potentially getting chopped. There’s also the fact that Trump has cut key infrastructure funding for electric vehicles. But the biggest brick of all through Tesla HQ’s windows may well be Donald Trump’s tariff policies.
On the latter matter, Elon Musk has actually spoken out against Trump’s “tariff czar,” in typical middle school fashion. Additionally, Tesla’s openly referencing the tariff sandstorm Trump is creating while warning shareholders about the year to come. In fact, the 3rd paragraph of Tesla’s Q1 2025 quarterly report was dedicated to this.
“Uncertainty in the automotive and energy markets continues to increase as rapidly evolving trade policy adversely impacts the global supply chain and cost structure of Tesla and our peers. This dynamic, along with changing political sentiment, could have a meaningful impact on demand for our products in the near-term. We remain committed to expanding our business model to include delivering autonomous robots across multiple form factors and use cases – powered by our real-world AI expertise – to our customers and for use in our factories, as we navigate these headwinds.”
Let’s break down those sentences briefly.
So, first of all, Trump’s inane trade war disrupting free trade, global supply chains, and market prices is going to hurt Tesla. Indeed.
In the second sentence, I’m not sure what they mean by “changing political sentiment.” That feels like something executives forced out as a compromise, or a way of papering over the damage Elon Musk has done to the Tesla brand. Perhaps it is referring to the global politics being disrupted by Donald Trump, or perhaps it is referring to the damage Elon Musk has caused to Tesla’s reputation and sales in the US, Canada, Europe, Australia, and probably elsewhere. Who knows?
Then you’ve got the last sentence. It seems to me that’s Elon Musk trying to wave his magic wand and say, It’ll all be alright, though, because robots and AI. Well, looking at Tesla’s market cap, that has worked out pretty well for Musk and company for the past several years. Will it continue to be enough? Will Tesla finally achieve some breakthroughs that make it all make sense? Will Tesla sales continue to crater without much actual help from robots and AI, leading to a true financial crisis at Tesla? Will the AI & robots division keep sucking capital out of Tesla without a return, and will vehicle and battery sales be enough to support that in the coming year? Who knows?
What we do know is Trump’s tariff war and tax on the middle class is very likely to slam Tesla sales even further. I wonder how long into the Trump presidency it will take until Musk and his minions realize they made a grave mistake by supporting Donald Trump to run the USA again. And this is not just literary entertainment. I truly wonder.
Where do you think Tesla is headed? And where do you think this tariff war is going to lead us?
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