Tesla Chief Executive Officer, Elon Musk, has announced that he will reduce his involvement in the Trump administration starting in May, as his company faces a major drop in profits.
Musk, who has been working for the Department of Government Efficiency, made this known on Tuesday during Tesla’s earnings call. He said, “Probably in the next month, my time allocation to DOGE will drop significantly.” He added that most of the work he was doing for the government was already done.
This comes after Tesla reported a 71 per cent fall in its profits for the first quarter of 2025. The company made $409 million during this period, while revenue dropped by nine per cent to $19.3 billion.
Some analysts have linked the company’s struggles to Musk’s high-profile role in government. They believe it has hurt Tesla’s image and led to boycotts and falling sales. Prices of used Teslas have also gone down, showing that public interest in the brand may be dropping.
Tesla’s Chief Financial Officer, Vaibhav Taneja, said on the call that the reaction from the public was “unwarranted hostility to our brand.”
The company also blamed new trade policies and global market uncertainty for its recent challenges. It pointed out that the Trump administration’s 25 per cent tariffs on imported cars were affecting the industry.
Despite the setback, Tesla said it still plans to launch new, more affordable vehicles in the first half of 2025. It also confirmed that its self-driving Robotaxi project in Texas is still on track for a June launch.
Musk promised to refocus on Tesla, saying he would now spend more time on the company. “Starting next month, I’ll be allocating far more of my time to Tesla,” he said, though he added that he might still spend a day or two each week on government matters if needed.
The announcement was well received by investors. Tesla shares went up by 4.7 per cent in after-hours trading following the news.
Market analyst Dan Ives from Wedbush Securities, who had earlier called for Musk to step away from his government role, praised the move. He wrote on X, “DOGE work basically ending… now his focus back on Tesla. (Wall) Street needed to hear this.”
Musk also mentioned that while he advises President Trump on some matters, like tariffs, he believes the final decisions rest with the president. “I’ve been on the record many times as saying that I believe lower tariffs are generally a good idea for prosperity,” he said.
