It might be time for Tesla CEO Elon Musk\u2019s own fork in the road.\u00a0\u00a0<\/p>\n
The electric carmaker is set to report quarterly earnings Tuesday afternoon that may say a lot about which direction Musk and the company he has ridden to immense wealth will go next.\u00a0\u00a0<\/p>\n
The company will update investors on revenue, profit and other key figures after months of turmoil as Musk continues to dedicate a large portion of his time to the Trump administration\u2019s attempt to radically remake the federal government, far away from his corporate responsibilities at Tesla, SpaceX and his other companies.\u00a0<\/p>\n
With Tesla\u2019s stock and brand reputation getting pummeled \u2014 and with President Donald Trump\u2019s tariff policy threatening to upend the automotive market, Tesla included \u2014 many Tesla investors have called on Musk to scale back or end his government work entirely and return his focus to business.\u00a0\u00a0<\/p>\n
The Trump administration has sent \u201cfork in the road\u201d emails encouraging federal workers to consider quitting their jobs. <\/strong>\u00a0<\/p>\n Even some of Tesla\u2019s loudest proponents, such as Daniel Ives, managing director at Wedbush Securities, have lost patience with how Musk is dividing up his attention.\u00a0\u00a0<\/p>\n \u201cThis is a moment of truth for Musk,\u201d Ives told NBC News. \u201cIf he picks staying with DOGE and the Trump White House, the future of Tesla could be negatively altered permanently. The brand damage he\u2019s created by being part of the Trump administration has already been a devastating blow to Tesla\u2019s reputation, stock and confidence. \u2026 He\u2019s made Tesla into a political symbol, which is one of the worst things that can happen to a consumer brand.\u201d\u00a0<\/p>\n DOGE refers to the Department of Government Efficiency, Musk\u2019s team of staffers spread throughout the executive branch helping to order spending cuts. Musk is a \u201cspecial government employee\u201d who\u2019s expected to leave the Trump administration at some point, but with no set date to depart.\u00a0<\/p>\n Musk and Tesla didn\u2019t immediately respond to a request for comment Monday afternoon on whether he is stretched too thin and, if so, what they might do about it.\u00a0\u00a0<\/p>\n Tesla is due to report earnings after the market closes. It also is scheduled to host a conference call with Wall Street analysts, and Musk sometimes joins the calls.\u00a0\u00a0<\/p>\n Several possible paths lie ahead for Musk and Tesla, and it\u2019s not clear which is most likely. Musk could scale back or end his White House job and spend more time at Tesla. Or he could quit as Tesla CEO and keep his focus on politics, putting the company\u2019s future and brand in someone else\u2019s hands.\u00a0\u00a0<\/p>\n The status quo may also endure, with Musk continuing to bet that he has enough attention for everyone.\u00a0\u00a0<\/p>\n Tesla\u2019s stock price has provided a snapshot of the tumultuous run since Musk threw himself into the Trump administration. While its stock price is almost even with where it traded in the days ahead of the election, its shares are down more than 50% from their December peak. Still, Tesla\u2019s total market cap remains just above $700 billion, well above those of its auto industry competitors but below those of major tech companies.\u00a0<\/p>\n On Monday, Tesla shares plunged again ahead of the earnings report, falling 5.8%.\u00a0\u00a0<\/p>\n Tuesday will mark Tesla\u2019s first earnings report since the full extent of Musk\u2019s government role and ambitions became clear. Tesla last reported on its financials on Jan. 29, early in Trump\u2019s second term.\u00a0\u00a0<\/p>\n In the past year, Musk has somewhat aggressively started to pivot Tesla into new possible lines of business, including a proposed Cybercab autonomous vehicle and a potential robotic humanoid called Optimus, although the company hasn\u2019t shipped either of those products and some on Wall Street are skeptical that they\u2019ll be successful.\u00a0\u00a0<\/p>\n In a note to clients, Wells Fargo stock researchers said they expected to hear more from Tesla on Tuesday about Cybercab and Optimus, but they called those subjects \u201crazzle dazzle\u201d that \u201cdistract from fundamentals.\u201d Wells Fargo has a price target of $130 a share for Tesla, far below the $227.50 close on Monday and near the low end of analyst price targets, according to The Wall Street Journal.\u00a0<\/strong>\u00a0<\/p>\n Tesla has already issued warning signs about its health. It reported April 2 that vehicle deliveries in the first quarter declined 13% from a year earlier, battered by rising competition and fallout from Musk\u2019s involvement in politics.\u00a0\u00a0<\/p>\n Hundreds of protests at Tesla showrooms have also weighed on the company. Under the banner of a \u201cTesla Takedown,\u201d opponents of Musk and Trump\u2019s government policies have targeted the company to try to gain leverage over Musk, and demonstrators have continued to swarm Tesla locations, especially on weekends.\u00a0\u00a0<\/p>\n Allen Adamson, a co-founder of Metaforce, a marketing and brand consultancy, said that if any other corporation faced a similar image problem, the board of directors might have stepped in to switch out the CEO. But Tesla\u2019s board is famously close to and supportive of Musk.\u00a0\u00a0<\/p>\n Now, Adamson said, Tesla faces risk whichever path it and Musk follow.\u00a0\u00a0<\/p>\n \u201cMusk is the magic that has fueled the stock price,\u201d he said. \u201cIf he steps aside [as Tesla CEO], he takes the rocket fuel out of the Tesla stock price, but if he stays, he\u2019s equally damaging the company\u2019s prospects.\u201d\u00a0\u00a0<\/p>\n One unknown factor is how much of the damage to Tesla\u2019s brand is permanent. In other words: If Musk were to leave the White House and return to business, would there be any improvement in the brand\u2019s public esteem?\u00a0\u00a0<\/p>\n Ives said it\u2019s hard to measure the damage Tesla has sustained.\u00a0\u00a0<\/p>\n \u201cIt\u2019s taken on a life of its own that he never expected \u2014 this has become something bigger and much more of a raging fire than he ever expected around Tesla,\u201d he said. \u201cHe sells a consumer brand globally, and the demand destruction \u2026 you can\u2019t wear rose-colored glasses about it, and to not see it would be smoke and mirrors.\u201d\u00a0<\/p>\n If Musk does turn his attention back to politics, he\u2019d still have an enormous challenge to rebuild the company\u2019s reputation, Adamson said. He said that Musk would need to stop other polarizing behavior, such as posting on X about controversial topics, and that he would have to improve the company\u2019s innovation. Tesla has launched only one new consumer vehicle since 2020, and that product, the Cybertruck, isn\u2019t widely popular.\u00a0<\/p>\n \u201cI don\u2019t think he can pull a rabbit out of a hat fast enough to prevent a continued spiral down,\u201d Adamson said.<\/p>\n<\/p>\n It might be time for Tesla CEO Elon Musk\u2019s own fork in the road.\u00a0\u00a0 The electric carmaker is set to report quarterly earnings Tuesday afternoon that may say a lot about which direction Musk and the company he has ridden to immense wealth will go next.\u00a0\u00a0 The company will update investors on revenue, profit and […]<\/p>\n","protected":false},"author":0,"featured_media":17091,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-17090","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/17090","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=17090"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/17090\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/17091"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=17090"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=17090"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=17090"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}