Elon Musk said he would return to Tesla, while scaling back his controversial role in the Trump administration – a factor blamed for the company’s plummeting profits and sales.

Billionaire Elon Musk will refocus on Tesla as the company faces many difficulties. Photo: REUTERS/TTXVN

According to CNN, on April 22, Mr. Musk told Tesla investors that he would reduce his working time at the Department of Government Efficiency (DOGE) to one to two days per week, starting next month.

“Starting in May, the time I spend on DOGE will be significantly reduced,” Musk said during Tesla’s earnings call.

Still, he defended his work on DOGE, saying it was necessary to cut down on “waste and fraud,” and urged investors to “look beyond the potholes.”

He made the announcement after Tesla reported quarterly financial results that fell far short of expectations, and warned that the escalating trade war has clouded the company’s outlook for the rest of the year.

While Tesla is less affected by tariffs than other automakers, the company said it needs to review its financial forecasts due to the impact of current trade disputes.

“It is difficult to measure the impact of changing global trade policies on our automotive and energy supply chains, our cost structures, and the demand for sustainable goods and related services,” the company said.

On April 3, President Trump imposed tariffs on imported cars and said he would impose additional tariffs on car parts in the coming months. Tesla builds cars for sale in the United States in its own factories, so it is less affected by tariffs on imported cars than its competitors. However, the company still imports parts for its U.S. assembly lines.

Elon Musk did not directly blame President Trump for the trade policy turmoil, but he also sought to distance himself from the administration on the issue:

“The decision on taxes is entirely up to the President of the United States,” he said. “I will give my advice. I have repeatedly spoken out in favor of lowering taxes to promote prosperity. I will continue to advocate for low taxes instead of high taxes. That is all I can do.”

Tesla’s business is in decline 

The world’s leading electric carmaker reported a 9% drop in quarterly revenue, a 20% drop in car sales, and a 39% drop in adjusted profit. Net income—the most stringent measure of profitability—fell 71% from a year earlier.

Earlier this April, Tesla warned that it had seen the biggest sales decline in the company’s history — delivering 50,000 fewer cars than in the first quarter of last year. It was also Tesla’s lowest quarter in nearly three years.

The drop is a shock for a company that until recently reported annual sales growth of 20% to 100%, a factor that helped push its stock price to stratospheric levels that once made Tesla the world’s most valuable automaker.

A Tesla store in San Mateo, California, USA. Photo: THX/TTXVN

Controversial Role in DOGE

In recent weeks, analysts have pointed to Musk’s controversial role in the Trump administration—specifically his leadership of DOGE—as a major factor in the unprecedented sales slump, which has led to protests outside Tesla showrooms and multiple incidents of property damage. Sales have also fallen sharply in Europe, where Musk has publicly supported far-right parties in Germany and the UK.

The tech billionaire suggested that protesters were only reacting because they had benefited from the “waste and fraud” that DOGE was eliminating. He went on to defend DOGE as the right thing for both the country and the company:

“I think the right thing to do is to fight waste and fraud and get the country back on track. If the ship that is America sinks, Tesla will sink with it.”

He also acknowledged criticism for spending too much time on DOGE and not enough time on Tesla. However, he said that the work on DOGE is “basically done” and he can now return to focusing on Tesla.

Tesla shares rose 4% in after-hours trading shortly after Elon Musk announced he would be phasing out DOGE.

When asked about the damage to his brand image, the billionaire businessman refused to blame the protests for the drop in sales, blaming the weak economy and consumer uncertainty, even though competitors saw sales increase during the same period.

Musk asserted that Tesla’s long-term prospects remain strong, despite weak results in the latest quarter:

“Tesla’s future is brighter than ever,” Musk said, adding that the current problems are less dire than those the company has faced in the past. He pledged that the company’s self-driving car and humanoid robot projects — though they have yet to materialize — will usher in an era of “sustainable prosperity for all.” “It’s going to be a happy future,” the Tesla founder promised.

Surrounded by difficulties

Tesla shares nearly doubled from Election Day to their mid-December peak on expectations that the new administration would introduce policies that would benefit Tesla. But the stock has since fallen 50% from its peak through the close of trading on April 22.

The company reaffirmed that it still plans to launch “lower-cost models” before the end of June.

Tesla also said it will launch a driverless “robotaxi” next year. The car will have no steering wheel, gas pedals or brakes, and a pilot service for the self-driving car will be launched this spring.

But Tesla’s problems extend beyond product delays, trade tensions, and Musk’s political role. The company also faces increasingly fierce competition from other electric carmakers, especially in China. Chinese automaker BYD has surpassed Tesla in electric car sales in several recent quarters, including the first quarter of this year, though Tesla has held the lead for the entire year. At this rate, Tesla could lose its crown by 2025.

China is the world’s largest electric vehicle market, and Tesla’s second-largest market after the United States. Tesla did not disclose sales in China in its April 22 financial report.