Tesla’s profit has fallen to its lowest point in five years as the electric-vehicle maker grapples with the fallout from Elon Musk’s alliance with President Donald Trump and the administration’s trade war.
Net income slid 71% to $409 m (£307 m) in the quarter to 31 March, making it Tesla’s least profitable period since 2020. Revenue dropped 9% to $19.3 bn, well short of market expectations.
The results lay bare the cost of Musk’s prominent role in the Trump White House. Progressive drivers have boycotted Tesla vehicles, and Trump-era tariffs are squeezing the company’s supply chain.
“Uncertainty in the automotive and energy markets continues to rise as fast-changing trade policies disrupt the global supply chain and Tesla’s cost structure,” the company warned. It added that “changing political sentiment” is hurting demand: first-quarter deliveries fell 13 pc.
Tesla cautioned that the dual impact of tariffs and boycotts “could materially affect near-term demand for our products.” The slump has intensified questions about whether Musk’s association with the MAGA movement has caused lasting brand damage.
The update landed hours after US Treasury Secretary Scott Bessent told a JPMorgan investor summit that the trade confrontation with China was “unsustainable,” hinting a deal might be near—an acknowledgment of the wider economic toll from tariffs that have shaken US stocks, bonds, and the dollar.
Tesla shares rose 4 pc on Tuesday ahead of the results and were little changed in after-hours trading, but the stock remains 40 pc below the record high reached in December after Trump’s election victory.
Investor confidence in Tesla has been rattled by a triple blow: cooling demand for electric vehicles, looming tariff risks, and consumer backlash over Elon Musk’s fervent support for the MAGA movement.
Progressive EV buyers have shunned the brand, causing sales to tumble among Democrat-leaning Americans and in European markets singled out by the Trump administration. To counter the drop, Tesla has resorted to hefty discounts—further compressing its margins.
