2 weeks Ago By ARA
Net profit at Tesla, the car company founded by tycoon Elon Musk, fell 71% in the first quarter of the year to $409 million, after recording a 20% drop in revenue from the automotive sector. The company is widely blamed for the Trump administration's push for public sector cuts, a fact that, among other things, could have taken its toll on its business. posted revenue of $19.
335 billion, down 9% from the same period last year. At the same time, the car manufacturer's operating expenses increased and margins shrank. However, the results, according to experts, are "worse" than analysts expected.
The prominence in the Trump administration Among the reasons for the decline is increasing competition from other manufacturers, especially Chinese ones, which has caused Tesla's market share to fall in key countries. This decline also coincides with the involvement of its CEO, Elon Musk, in the administration of US President Donald Trump. Musk has become Trump's right-hand man since the Republican won the presidential elections in November 2024, and heads the controversial Department of Government Efficiency (DOGE), which is tasked with making cuts to reduce the country's public spending by trillions of dollars.
The measures adopted by DOGE, Musk's proximity to Trump, and the businessman's political statements supporting far-right groups in Europe and the rest of the world have caused a serious image crisis for Tesla. In recent months, in fact, the company has suffered boycotts and protest actions in both North America and Europe. The trade war launched by Trump against the rest of the world, especially China, has also harmed the interests of Tesla, which has a vehicle production plant in the Asian giant.
All of this has led Musk to make some changes. Last Tuesday night, the magnate announced that starting in May he will reduce the time he dedicates to the government's Department of Energy to "one or two days a week" in order to pay more attention to Tesla. The decision was announced during a video conference with automotive industry analysts, after the company had already made public its economic slump during the first quarter.
The businessman clarified that the work done by Trump's department is "very important" and that it has been "a great progress in responding to waste and fraud." Even so, he emphasized that from now on, the time he dedicates to it "will drop significantly." "I'll do it for a day or two a week as long as the president wants me to and as long as I'm useful," the tycoon concluded.
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