Donald Trump completed Tesla's MAGA heel turn by hosting an informercial for the embattled automaker owned by his "first buddy" Elon Musk.
The electric vehicles had been a liberal status symbol since hitting the market as an environmentally friendly alternative to gas-powered cars, but Musk alienated existing customers, would-be buyers and stock market investors with his political alliance with Trump and especially his efforts to fire thousands of federal workers and eliminate government agencies, reported Axios.
"We struggle to think of anything analogous in the history of the automotive industry, in which a brand has lost so much value so quickly," said J.P. Morgan analyst Ryan Brinkman.
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Tesla stock has lost $800 billion in market cap since December and "Tesla Takedown" protests have flared up outside dealerships, while current owners have reported vandalism and harassment, and the president publicly threw his support behind his campaign donor and adviser with a promotional event at the White House.
"Standing alongside Musk and a row of Teslas on the South Lawn, Trump said he'd buy a Model S sedan for White House staff and threatened to classify anti-Tesla violence as domestic terrorism," Axios reported. "Photographers captured a shot of Trump holding a Tesla sales script that listed out prices and features, a brazen challenge to ethical norms as the president said he hoped the event would boost Tesla sales."
Fox News host Sean Hannity also raved about buying a Tesla and promised to give one away on his website, but a longtime champion of the company's stock warned that politicizing the brand was a "dangerous path"
"Tesla is becoming a political symbol of Trump and DOGE, and that is a bad thing for the brand," Wedbush analyst Dan Ives, a longtime Tesla bull, told Axios.
A 2022 analysis by Scarborough Research found Teslas were most likely to be associated with Democratic buyers, but the brand is now considered politically toxic with Democrats, and it's not clear whether Trump's endorsement will motivate Republicans to buy the cars in significant numbers.
"Car buying means something different to everyone and if the price is right, you can still get some consumers to put their personal feelings aside," said van Drury, an analyst at car-research site Edmunds.
The automaker's sales are down sharply in Europe and slumping in the critical markets of California and China, and Ives said that investors are concerned Musk has turned his focus away from his company to transform the U.S. government through his Department of Government Efficiency.
“As someone who’s covered Tesla for many, many years, it was time to communicate to Musk and the board what Tesla shareholders are telling us: Balance your time, show that you are Tesla CEO,” Ives told Fortune. “This is not the time to just play in the DOGE sandbox. He needs to step up.”
Ives still believes in the stock and forecasts it'll be worth $550, more than double its current value, in 12 months, but he said that also depends on whether Musk continues to spend most of his time at the White House and Mar-a-Lago instead of Tesla’s factories and manufacturing facilities.
“Investors have had enough,” Ives said. “They own Tesla because of Musk, not because he runs DOGE.”
