Tesla has flirted with disaster before. This time feels different.

Earlier this month, standing on the White House driveway, President Donald Trump hawked a fleet of gleaming Teslas with the kind of gusto normally reserved for his campaign rallies. Clutching handwritten notes about prices and models, he said, “I’m going to buy one because it’s a great product, as good as it gets.” Elon Musk, Tesla’s CEO and a key figure in the administration, stood nearby.

Many assumed Musk’s proximity to Trump would be a net positive. But his involvement with the Department of Government Efficiency and its efforts to shrink the federal government have triggered an identity crisis within Tesla. Musk has been quietly shifting rightward for years. Public sentiment, analysts, and owners didn’t turn until it became clear that DOGE was more than just a passing fancy — one with the power to impact millions of Americans.

To understand how Musk’s foray into the federal government has threatened to upend Tesla’s position as the world’s most valuable automaker, Business Insider spoke with more than two dozen employees, investors, analysts, and customers.

As one former Tesla sales manager put it, “it feels like he’s supporting someone that goes against Tesla’s original mission.”

Musk appears to have recognized the stakes. On Thursday, Tesla held a surprise after-hours all-hands that was live-streamed to the public from its Texas Gigafactory. It caught employees and investors off guard, and it appeared to be an attempt at damage control. Musk implored employees not to sell their stock and admitted that he had been “stretched pretty thin.”

Tesla and Musk are used to dire predictions. Musk has said the company nearly collapsed during Model 3 “production hell,” and critics have repeatedly declared the electric-car maker doomed over the past decade. Each time, Tesla has defied expectations and emerged stronger.

For some employees, analysts, and investors, Musk’s political entanglements now represent an entirely different challenge as the company’s increasingly unpopular CEO becomes the face of government downsizing.

Tesla is at a tipping point.

For the better part of a decade, Tesla has been a Wall Street phenomenon. Its stock has surged over 1,000% in a five-year period as employees, investors, and customers remained loyal to one of the few successful green car companies. They were willing to overlook provocative tweets and missed deadlines in exchange for explosive growth.

Then came February.

What began as a gentle slide became a stock slump that JP Morgan analysts called the worst they had seen in the history of the auto industry. Its stock is down 31% year-to-date, despite a recent rebound following Musk’s all-hands meeting. Howard Lutnick, Trump’s commerce secretary, tried to stanch the bleeding, imploring Americans to invest in the company because “it’ll never be this cheap again.” Musk’s net worth has also fallen by $129 billion since Trump’s inauguration, according to the Bloomberg Billionaires Index.

Tesla and Musk did not respond to requests for comment.

Musk has previously spoken out against the protests at Tesla facilities, and told employees during the all-hands that investors need to think long-term when it comes to investing in Tesla. He touted the carmarker’s future in robotics and self-driving technology and predicted that “Tesla will probably be the most valuable company in the world.”

Last month, Tesla investor Ross Gerber told BI that Tesla stock could fall as much as 50% in 2025, in part because it was unlikely to reach its own goal of launching a robotaxi service in Austin by June. Since then, the stock has fallen as much as 28%.

Even longtime Tesla bull Dan Ives had a moment of concern. Musk “needs to take a step back, balance, and become CEO of Tesla again,” the Wall Street analyst said. “Leaders need to lead.” (Ives later described Musk’s surprise town hall as a “big step forward” in a note to investors.)

Musk’s commitment to DOGE — his private jets have landed near Tesla locations a handful of times since January 20, according to the plane-tracking site JeySpy, and he hasn’t sent one of his signature companywide emails since June of last year — has been a particular source of angst for investors.

Several of the carmaker’s key projects — including the robotaxi, its Optimus robot, and a $25,000 new car — are also major question marks.

Meanwhile, Tesla is facing more competition than ever before. Chinese manufacturers like BYD are undercutting Tesla on price while outpacing them in innovation. BYD said Monday its sales topped $100 billion last year, outpacing Tesla. Last week it unveiled a charging station that it says is faster than Tesla’s.

While Wall Street may be in a twist, many Tesla employees aren’t quite as worried — at least when it comes to the stock price. Others expressed concerns about Musk’s involvement in politics and its impact on Tesla.

“For anyone who’s worked at Tesla this isn’t anything new,” one longtime Tesla employee said. “There’s been so many ups and downs at Tesla, you get desensitized at a certain point.” (Like several other people who spoke to BI for this story, the employee asked to remain anonymous.)

Elsewhere, cracks have started to appear.

In February, The New York Times reported that a Tesla manager, Jared Ottmann, was terminated after he criticized a social media post from Musk that referenced Nazi Germany. (In a statement, Ottmann directed BI to his attorney Jana Moser. Moser did not respond to a request for comment.)

BI spoke with two Tesla workers who left the company in recent weeks, and five other employees said they were looking for opportunities elsewhere. They all pointed to Musk’s role in politics and what they felt was a move away from Tesla’s original mission of building sustainable transportation.

“Morally, I’m not sure how much longer I can work for somebody like that,” one engineer said.

Thomas Temme, a Tesla software engineer based in Germany, told BI he and other German workers have talked among themselves about Musk’s new political focus, both in the US and in his promotion of the AfD, a German right-wing political party.

In Europe, where workers have more protections than in the US, employees are still concerned they could face repercussions for speaking up to management against Musk.

“They don’t speak up because they fear if they speak up Elon might fire them or get rid of our whole department,” Temme said.

One California-based worker described the internal corporate environment as “unsettling.” More than a dozen workers have told BI over the past few months that there’s been little conversation internally about Musk’s role in government or the public outcry since Musk began campaigning for Trump last year.

“I think people are on edge and aren’t quite sure who they can trust,” one worker said. “We have a high prevalence of people on visas, and I think people are generally anxious about retribution.”

Tesla salespeople and owners, it seems, are bearing the brunt of the public anger.

The carmaker reported several incidents of vandalism at its sales and service centers, including gunshots that blew out store windows, superchargers that were set alight, and Molotov cocktails thrown at vehicles.

Three sales workers told BI they’ve dealt with disgruntled customers and prank callers in recent weeks. They said they’d been encouraged by local management to avoid engaging with the protesters, but they haven’t received companywide communication about the protests.

“They’re exercising their right to peaceful protest,” one salesperson said. “As long as it doesn’t cross into anything more we’ll let them be.”

Multiple Cybertruck owners also said they’d face growing hostility and harassment, from their cars getting hit by paintball guns and tagged with crude graffiti to being yelled at by other drivers. Recently, a webpage doxxed Tesla owners and said it would only remove their personal information if they agreed to sell their vehicles.

For those who want to sell, there’s also bad news. Resale values for Teslas have fallen and are about $10,000 less than their non-Tesla EV counterparts, according to data from CarGurus. Kevin Roberts, the firm’s director of economic and market intelligence, said there’s also pressure on used Tesla prices because the market has been flooded with used electric cars after rental companies like Hertz have moved away from EVs.

New car sales aren’t a bright spot, either. Key indicators show sales are slumping in multiple markets, including the US, where new Tesla registrations fell by 11% in January, based on data from S&P Global Mobility. In Europe, registrations fell across 25 European markets by an average of 44% in February, according to JATO Dynamics data.

Some Tesla owners told BI the protests have strengthened their support for Musk — one analyst suggested recently that red states could help salvage the company’s sales. Many others are choosing to add anti-Elon stickers to their vehicles or ditch them entirely.

Scott Oran, a real estate developer from the Boston area, said he sold his Tesla in February “as a protest” against Elon Musk and his work at DOGE. Another Tesla Model 3 owner, who asked to remain anonymous, said they decided to sell for fear that Musk’s political activities could cause Tesla’s plummeting resale values to drop even further.

Daniel Cavanaugh, an EV owner in Los Angeles, told BI he paid $4,000 in March to end the lease of his Model 3 five months early after becoming concerned about Musk’s behavior and the possible end of EV subsidies under the Trump administration.

“I was actually considering getting another Tesla before the subsidies ended. But Elon’s behavior was so vile I decided to shop around,” Cavanaugh said. “Tesla’s sales slump isn’t temporary. Elon is driving away customers like me and driving us to discover his competitors — and we are not coming back.”

Since its founding, Tesla has teetered on the brink of extinction more than once.

“Musk has this sort of innate, though sometimes tardy, ability to course correct,” Nancy Tengler, a Tesla shareholder, told Business Insider. After selling off her shares following Musk’s pot-smoking appearance on Joe Rogan’s podcast, Tengler said she learned her lesson when the stock surged in 2022.

“You underestimate him at your peril,” she said.

The company’s recent market performance hasn’t scared everyone off. Ives is still bullish on the stock, as is shareholder Fabian Varcianna, who still believes that Tesla’s technology is revolutionary. He said he invested more during the March sell-off and plans to purchase an Optimus bot. Retail traders have been gobbling the stock up as it craters.

Alexandra Merz, a Tesla investor and influencer more commonly known by her X handle @TeslaBoomerMama, told BI she thinks the stock might have hit its low point last week but could dip further. She sees it as an excellent buying opportunity because of Tesla’s “milestones in the next five years.”

Merz said she advises potential investors to look beyond short-term volatility. “For Tesla, in particular, you really need a horizon,” she said.

Even with the recent crash, Tesla stock is up 63% compared to this time last year. It’s still the most valuable automotive company in the world. Musk’s status as “first buddy” could still pay off. Lutnick and Trump’s sales pitches and the surprise Austin all-hands seemed to calm the waters.

The moment, though, is perilous. Musk’s popularity has fallen in tandem with his status as a target for public vitriol toward the administration.

“It’s never been a political symbol, and that’s what Teslas have become,” Ives said. “It’s become a brand crisis.”

Even Musk seems surprised.

“Listen, I understand if you don’t want to buy our product, but you don’t have to burn it down. That’s a bit unreasonable,” Musk said during the all-hands.

“If you read the news, it feels like Armageddon. I can’t walk past the TV without seeing a Tesla on fire,” he said. “What’s going on?”

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