Tesla and SpaceX CEO Elon Musk, speaks next to a Tesla Cyber Truck and a Model S on the South Lawn of the White House” width=”970″ height=”647″ data-caption=’Tesla’s fading momentum may have less to do with its cars and more with its CEO’s politics. <span class=”lazyload media-credit”>Andrew Harnik/Getty Images</span>’>
How did Tesla go from the world’s fastest-growing automaker to a company beleaguered by slowing sales and shrinking market share? According to a team of Yale researchers, the answer lies in the polarizing and partisan behavior of CEO Elon Musk.
Sure, Tesla has faced headwinds from aging models, rising competition, and a saturated customer base. But an analysis of county-level data shows that its declining demand is also linked to Musk’s increasingly political actions. The study’s authors estimate that Tesla would have sold between 1 million to 1.26 million more cars in recent years without what they call the “Musk partisan effect.”
During the most recent quarter, Tesla’s profit plunged 37 percent year-over-year. Revenue fell for two consecutive quarters this year. (The most recent quarter saw a rebound thanks to tax credits-fueled buying rush.)
The Yale researchers argue that much of Tesla’s decline stems from the alienation of its traditional consumer base. Drawing on vehicle registration data from S&P Global and county-level voting records, they found that Tesla’s customer base has long leaned Democratic and environmentally conscious.
That began to change in 2022, when Musk acquired X and rolled back content moderation policies. The shift deepened amid his involvement in the 2024 U.S. presidential election and his subsequent appointment as head of the Trump administration’s Department of Government Efficiency (DOGE). “Musk’s actions antagonized his most loyal customer base,” the authors wrote.
The trend has only grown more pronounced. Between October 2022 and April 2025, Musk’s partisan behavior caused Tesla to lose between 67 percent and 83 percent of its potential car sales, according to the study. In the first quarter of 2025 alone, that figure jumped to 150 percent.
Musk himself has acknowledged the backlash. During an April earnings call, he said his DOGE role had led to “blowback” and announced plans to scale back his time with the agency to refocus on Tesla.
The fallout hasn’t even benefited Tesla’s competitors. The study found that, absent Musk’s partisan behavior, sales of other EV and hybrid models would have been 17 to 22 percent lower over the past three years and 25 percent lower in early 2025, suggesting his actions helped rival automakers.
Musk’s controversies have also had unintended policy consequences, the researchers noted. In California, which aims for zero-emission vehicles to make up 25 percent of new sales by 2026, 68 percent by 2030, and 100 percent by 2035, progress has stalled. The study estimates that without Musk’s partisan impact, California would have added 139,700 more EV sales in the first quarter of 2025. The reality is that California fell short by 28,000 vehicles in that quarter to stay on track.
This study highlights just how impactful a CEO’s partisan actions can be,” the authors concluded.
