Elon Musk Leaves Trump's Team, What Does That Mean for Tesla?
So, Elon Musk isn't working with the Trump people anymore. This makes some folks who invest in his companies kinda hope he'll focus all his energy back on his huge business world. You know, like Tesla, which hasn't been selling as well lately, and Space X, since their last rocket didn't quite do everything they hoped.
He actually left his gig in Washington on Wednesday. That's a little good news for Tesla investors, especially since their stock has gone down this year. Part of the reason, apparently, is that some people weren't happy he supported Donald Trump and some right-leaning groups in Europe. He was even in charge of this project Trump had to cut down on government spending, which got a lot of people talking.
Now he's back to his main job, and it's a mix of good and bad stuff. Tesla's sales dropping is definitely testing people's patience. But then you look at Space X and Starlink, and those guys are pretty much ruling their markets. They're often the go-to for sending stuff into space and getting satellite internet set up. Other countries are even looking at Starlink more now, and his close ties with Trump probably helped make that easier.
But yeah, that relationship has also caused some issues. Right before he said he was leaving Washington, he wasn't too happy about a new tax bill coming out. Plus, he recently said he was going to spend less money on politics. Last year, he spent a ton, like almost £235 million, on Trump's campaign and other Republican candidates. That's a lot of cash, tbh.
Tesla shares didn't really move much on Thursday, but they've lost about a quarter of their value since December. The stock actually went way up at first because of the Trump connection and people thinking his 'robotaxis' would get approved super fast. But then sales dropped, and people started protesting because he's buddies with some far-right politicians and, well, he fired some government workers. Ouch.
Experts say Tesla really needs to fix things on the inside to get sales going up again. It seems like more and more people wanting electric cars are checking out other companies, especially in China, where things are growing super fast. Seth Goldstein, who looks at companies for Morningstar, said that while Musk leaving the government thing might make people feel a bit better, it probably won't really change things for Tesla. He thinks Tesla's sales falling show that their current cars aren't as popular anymore and they're facing serious competition everywhere, like in the US, China, and Europe.
Tesla's stock still seems way more expensive than other big tech companies like Nvidia or Microsoft, and definitely more than regular car companies. Even with the sales dip, some analysts, like Dan Ives from Wedbush, still believe the future value of Tesla is all tied up in their self-driving tech. He even said recently that could be worth maybe £790 billion just for Tesla. Wild, right?
We asked Tesla what they thought, but they didn't get back to us right away.
His connection with Trump definitely helped his companies out. We heard that Musk's team was using his AI chatbot, Grok, in the government to look at data. Some people are worried because they think this could give Musk access to important government info about contracts, giving him an edge over other companies that do similar stuff. The White House said Trump's team will keep working with the government employees who were part of that project, even though at least one of Musk's main guys, Steve Davis, has already left.
Speaking of Space X, that rocket launch this week didn't go as planned. It blew up over the ocean quicker than expected and didn't hit some of its main test goals. This means things are paused again for that rocket, which is supposed to be a big deal for the US space program. The government gave Space X the okay for this flight just a few days before, after they looked into a problem that had kept the rocket on the ground for almost two months. Space X has always had its own team run by Gwynne Shotwell, but after this latest launch, Musk said he wants to spend more time on the company. That rocket is still a long way from being able to land people on the moon or Mars, tbh.
Someone who invests in Tesla, Thomas Martin, said that even though Musk isn't officially in the government anymore, he probably still knows people there. So maybe his influence is a little less, but it probably won't change much when it comes to getting things approved. Idk.
Musk has been pretty quiet about laws in Congress that could affect electric cars, but late on Wednesday, Tesla Energy actually spoke up against Republican plans to get rid of energy tax credits. They put something on their X account saying that ending those credits suddenly would be bad for America's energy independence and if our power grid is reliable. The Republican plan might cut tax breaks for buying electric cars and solar stuff, and even for making batteries. That could really hurt Tesla.
Next month, Tesla is supposed to launch its 'robotaxi', and that's a really big deal for Musk. He wants to focus more on self-driving cars and those Optimus robots instead of just making affordable electric cars. Right after the news came out that he was leaving his Washington job, Musk said Tesla has been trying out self-driving cars in Texas and plans to deliver the first ones in June. He said it would be the first time a car delivers itself from the factory to the customer. Pretty wild to think about, huh?
