Cnn
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Like many American manufacturers, Tesla is taken under an obligation thanks to the trade war of President Donald Trump.
Unlike most of these other companies, Tesla has an additional wrinkle – her CEO, Elon Musk, sometimes called the first friend for the close relationship he cultivated with the president.
Tuesla reports on Tuesday; This afternoon, Musk will answer investors’ questions. But there is a wrestling of 22: if Musk continues its close ties with Trump, the company could alienate potential customers, at home and abroad, who do not like Trump policies. If he distances himself from Trump, he risks the anger of the White House. It is a losing situation, and it is a trap of the own manufacturing of musk.
The first quarter saw the company The greatest drop in sales After growth in two -digit sales practically constantly. But the finances of the automaker are only part of what investors will want to know.
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Investors will want to know how much 25% prices of the Trump administration On all imported vehicles cost Tesla and what Musk thinks about it.
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A big question is when Musk intends to step back from the Ministry of Effectiveness of the Government, or Doge, in Washington, and to focus on solving Tesla problems.
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People are waiting to see progress on autonomous cars, a Robotaxi fleet, a new cheaper Tesla model and plans to sell humanoid robots.
The reassuring responses on all these subjects could help to reverse the slide which has destroyed about half of the value of Tesla (Tsla) Since mid-December-and perhaps restore some confidence in the business.
Dan Ives, Wedbush Securities and Tesla Bull analyst for a long time which has nevertheless revocal its course objective for Tesla Share, said that Musk is confronted with a “red situation of the code” if he continues his high level role in the Trump administration.
Bleamless the brand’s damage to fall in sales, Ives told customers in a note on Sunday that “Musk needed to leave the government, to make a major step back to DOGE and to become CEO of Tesla at full time.”
Beyond the musk’s backlash, Tesla is also faced with growing competition from other EV car manufacturers, especially in China. Bad news on one of these fronts could cause a new descending spiral for actions.
“It has become a nightmare for Tesla and for investors,” Ives told CNN. “The prices, the controversies Doge, the brand damage – it was a perfect storm.”
In some respects, Tesla is less exposed than other car manufacturers at Trump automotive rates. Anyway, no cars in his two factories abroad, and he uses fewer foreign parts in his vehicles built in the United States than other car manufacturers. All other large car manufacturers also have at least certain vehicles imported into their American dealers.
He stopped Take new orders in China For its Model S and its Model X cars at high prices, which are built in California, due to reprisals in China at 125%, but these models are only a small fraction of its overall sales.
But Musk said the cost for Tesla would be “not trivial. “”
“Important to note that Tesla is not unscathed here. The price impact on Tesla is always important”, he said On his social media platform, X, the day after the announcement of Trump’s automotive rate plans.
But too much criticism of the prices during Tuesday’s call could harm his Bromance with Trump. Musk became Trump’s biggest financial donor last year and is one of his closest advisers since the inauguration.
Tesla shares have almost doubled in the two months after the elections, because some investors and analysts hoped that Musk would influence Trump to implement policies adapted to Tesla, especially on autonomous vehicles.
Conversely, strong support for Trump’s pricing policies could irritate Chinese authorities and electric vehicle buyers. China is the largest automotive and EV market in the world, but its consumers are increasingly turning to competitors such as the own BYD in China. Tesla reserved $ 20.9 billion in sales in 2024 in China, or about 21% of its revenues, its second market after the United States.
Ives described China “the screen spin towards the future success of Tesla”. He warned that “Trump’s pricing policies in China and the Musk association will be difficult to underestimate”.
The manifestations outside the Tesla exhibition halls and vandalism in its facilities highlight the backlash of society and its CEO is confronted. Some of the most popular investors’ questions on the Tesla site approach this issue.
“Did Tesla have experienced significant changes in the entry rate from order to the first quarter concerning all rumors of” brand damage “?” Read a question approved by more than 1,000 investors.
“How does the company plan to manage the impact of Elon’s partnership with the current administration?” asked another question of popular investor. Another asked: “Boycotts, demonstrations, vandalism, negative titles and a stock slide were triggered by Elon Musk’s participation in changes in the services and use of us.
When Musk held a meeting all the hands for Tesla employees last month, he sparked a one -week gathering in his beaten actions. But the rally turned out to be short -lived.
On April 2, when Tesla said that her decrease in quarterly sales from one year to the next Politico Headed a story later in the morning that Musk would soon abandon its role in government. The news has raised the actions. However, Musk and other members of the administration said that history was not exact.
“The report on sales and production of the first quarter of Tesla makes us think that-if something-we may have underestimated the degree of reaction of consumers,” wrote Jpmorgan Chase Ryan Brinkman analyst in a note to customers earlier this month.
Tesla did not respond to a request for comments on her sales or the impact that the role of Musk in the administration had on these sales.
Musk made ambitious promises for a fleet of autonomous robot robots and humanoid robots, saying that they will do the most of the business precious in the world.
He had praised plans for a driverless service in Austin, Texas, which should start in June. But there was no update. Meanwhile, the Uber and Google, Waymo, beaten tesla a punch With the start of its own taxi without joint driver in this city.
“It would be an enormous negative for the stock if it pushed (Robotaxi’s plans),” said Ives. “We have to hear good news there, because there will be no good news in terms of earnings or what the rest of the year will look like.”