Elon Musk to Scale Back Government Role After Tesla Profit Plunge

Elon Musk to Scale Back Government Role After Tesla Profit Plunge

Elon Musk to Scale Back Government Role After Tesla Profit Plunge

So, here’s the big update out of Tesla—Elon Musk just announced that he’ll be stepping back from his controversial role in the so-called “department of government efficiency” (or "Doge") starting in May. And honestly, the timing couldn’t be more critical. This comes right after Tesla reported a massive 71% plunge in profits in the first quarter of 2025, which shook investors and analysts alike.

On a call with investors, Musk stated that the “heavy lifting” of his government work is mostly done and that going forward, he’ll only be committing one to two days per week to that role. Now, that’s still a presence, but it's a significant step back from what many saw as a major distraction from Tesla’s core mission—especially in a time of such financial strain.

Let’s break it down: Tesla brought in $19.3 billion in revenue, a 9% drop from last year, falling short of the expected $21.45 billion. Earnings per share also disappointed at 27 cents, compared to Wall Street’s prediction of 43 cents. And perhaps most worrying of all, net income dropped from $1.39 billion to just $409 million. That’s a staggering decline.

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Deliveries were down too—by 13%, to 336,681 vehicles. That makes it Tesla’s worst quarter since 2022. And it’s not just about numbers; there’s a branding crisis brewing. Musk’s government involvement, especially tied to the Trump administration, hasn’t sat well with many consumers. Cars have been vandalized, long-time Tesla owners are jumping ship, and even auto shows are dropping the brand. The Vancouver International Auto Show pulled Tesla from its March lineup, and a recall of 46,000 Cybertrucks didn’t help the optics either.

Still, not everyone’s panicking. Some analysts, like Thomas Monteiro from Investing.com, see this as a "not-as-bad-as-expected" moment. He noted that even with all the turbulence, Tesla still pulled in nearly $20 billion in revenue. That resilience suggests there’s hope—especially with the anticipated rollout of the affordable Tesla model and the long-awaited Robotaxi later this year.

But for many, it all hinges on Musk. Wedbush Securities was blunt: if Elon stays tied up in Washington, Tesla’s brand will suffer further. If he comes back full-time, there’s still time to turn the ship around.

Musk himself remains optimistic. On the investor call, he painted a vision of Tesla driving toward a future of “sustainable abundance” powered by AI and affordability—a future he described as the “happiest” imaginable. That’s a bold vision, and it's classic Musk.

Bottom line: Tesla’s in rough waters, but the next few months could be make-or-break.

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