Musk vows DOGE pullback as Tesla profits plunge

Tesla shares are down more than 40% this year

(Image credit: Eugene Gologursky / Getty Images for Save Tesla Fire Musk Campaign)

What happened

Tesla Tuesday reported a 71% tumble in profits and a 9% drop in revenue last quarter versus a year earlier, a steeper-than-expected decline it attributed in part to a "changing political sentiment" that "could have a meaningful impact on demand for our products in the near term."

Who said what

Investors and shareholders have "become increasingly frustrated" with Telsa CEO Elon Musk, attributing "many of the company's woes to the upheaval he has caused in the federal government" by helming President Donald Trump's DOGE operation, The Washington Post said. Musk defended his DOGE work in a call with Wall Street analysts but said he would be "allocating far more of my time to Tesla" starting next month and spending just "a day or two per week on government matters."

Tesla's 13% drop in global vehicle sales last quarter was due to "intense competition from Chinese carmakers" and its "lack of new models," not just Musk's support of Trump and "far-right causes," The New York Times said. Musk said Tesla's future was in artificial intelligence and long-promised fully autonomous vehicles.

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What next?

Tesla shares, down more than 40% this year, rose 5% in extended trading as investors took "comfort in Tesla reaffirming plans to launch more affordable models later this year," The Wall Street Journal said. But the company has not "displayed a prototype or provided many details about" this cheaper model, the Times said, and "analysts doubt" it will roll out "anytime soon."

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Peter has worked as a news and culture writer and editor at The Week since the site's launch in 2008. He covers politics, world affairs, religion and cultural currents. His journalism career began as a copy editor at a financial newswire and has included editorial positions at The New York Times Magazine, Facts on File, and Oregon State University.