Tesla investors uneasy as Musk courts political controversies
Tesla shareholders are eagerly seeking responses from Elon Musk concerning his political involvement, particularly his advisory role in Donald Trump's administration and controversial gestures during the presidential inauguration. Investors are concerned about how the CEO's actions might affect the company's value.
After Donald Trump was inaugurated for his second presidential term, Elon Musk assumed a prominent advisory position in the Department of Government Efficiency (DOGE). This development coincided with the release of Tesla's financial report for the fourth quarter.
Prior to the report's release, investors have the opportunity to raise questions about the company's future. It appears that Musk's recent decisions are sparking debates. Over a hundred shareholders have questioned the billionaire's political involvement.
Attention was particularly drawn to the fact that the CEO donated $270 (£220) million to support Trump's campaign and other Republican candidates. In the last quarter of 2024, Musk was actively involved in the election campaign, spending significant time at the Mar-a-Lago estate.
Controversies surrounding the CEO's actions
Musk has also caused a stir on the international stage. In December, he openly endorsed the far-right AfD party in Germany ahead of the upcoming elections. According to Brand Finance, Tesla's brand value declined by 26 per cent last year, partly due to Musk's divisive stance.
During the inaugural ceremonies of Trump's new presidency, Musk made a gesture that historians and politicians likened to a Nazi salute. Ruth Ben-Ghiat, an expert on fascism, wrote that the gesture "was a Nazi salute -- and a very belligerent one too." In response to the criticism, Musk dismissed these accusations as a "hoax".
Will Musk suffer due to the controversial gesture?
Investors are worried about the potential impact of Musk's political activity on Tesla's sales performance. They inquire about specific sales losses resulting from his political actions and the company's strategy in response to the CEO's controversial statements.
During the previous earnings call in the third quarter of 2024, despite numerous queries about Musk's political involvement, this issue was not addressed. Tesla is under no formal obligation to discuss these matters during the forthcoming earnings conference.
Bill Gates criticizes Musk's political involvement
Criticism of Musk also emerges from other quarters. Bill Gates has explicitly distanced himself from comparisons with the Tesla and SpaceX owner in an interview with "The Times". The Microsoft co-founder highlighted fundamental differences between them, especially regarding political involvement.
Gates expressed concern about the possibility of foreign billionaires influencing electoral processes. He mentioned that "in the US foreigners aren’t allowed to give money" for political purposes, suggesting that other countries should adopt similar regulations.
Gates criticizes Musk's far-right sympathies
The Microsoft co-founder criticized Musk for backing radical political movements. Gates found Musk's support for the German AfD party and criticism of Nigel Farage for not being right-wing enough to be unacceptable.
Gates observed that despite Musk's undeniable intelligence, his actions focus on "populist stirring" rather than constructive utilisation of his potential. He also voiced concern about the growing political polarisation and the spread of animosity towards foreigners.
Controversial support for AfD
Elon Musk actively engaged in the German election campaign, appearing online during the AfD campaign's inauguration. He labelled this party as Germany's "best hope" and encouraged Germans to move past guilt over the past.
According to reports from the "Financial Times", Musk's actions extend beyond the German political scene. The Tesla owner was also reported to be involved in British politics, supporting actions against the British Labour Party and its leader.
