Elon Musk Quits DOGE—What’s Next for Tesla Stock?
🎯 Summary
Podcast Episode Summary: Elon Musk Quits DOGE—What’s Next for Tesla Stock?
This 21-minute podcast episode, hosted by Guy from Coin Bureau, provides an in-depth analysis of the recent turmoil surrounding Tesla (TSLA), focusing heavily on the fallout from Elon Musk’s political entanglements, specifically his association with Donald Trump’s “Department of Government Efficiency” (Doge), and how this drama, combined with operational challenges, has impacted the company’s stock performance.
1. Focus Area: The primary focus is General Tech/Automotive Stock Analysis, centered on Tesla’s business performance, market perception, and the significant influence of CEO Elon Musk’s personal and political activities. Secondary themes include the intersection of politics and corporate branding, and future technological bets (AI/Robotics, FSD).
2. Key Technical Insights:
- Robotaxi/FSD Timeline: Musk has tentatively set a June 22nd launch date for the Robotaxi service, claiming that all new Teslas coming off the line are capable of unsupervised self-driving, despite past delays and safety concerns.
- Optimus Commercialization: Tesla is moving the Optimus humanoid robot into pilot production, with Musk predicting thousands working in factories by the end of the year and millions in annual production within five years, positioning it as potentially Tesla’s biggest product ever.
- Energy Sector Growth: Tesla’s energy storage division is showing impressive strength, with management projecting at least 50% year-over-year growth in 2025, potentially surpassing the automotive division in importance.
3. Market/Investment Angle:
- Stock Performance & Sentiment: TSLA has been the worst-performing stock in the S&P 500 due to weak Q1 2025 financials (20% drop in car sales, 70%+ profit fall) exacerbated by political backlash.
- Political Risk Premium: Analyst downgrades (August Research, Baird) note that TSLA is now trading on factors unrelated to fundamentals, driven by uncertainty stemming from Musk’s public feuds.
- Competitive Threat: Chinese EV makers like BYD are posing a significant threat by offering cheaper and arguably superior models, potentially impacting Tesla more than Musk’s political distractions.
4. Notable Companies/People:
- Elon Musk: Central figure; his association with Trump’s “Doge” commission alienated Tesla’s core, environmentally conscious customer base. His subsequent public feud with Trump caused further stock volatility.
- Donald Trump: His administration established the “Doge” advisory body, which Musk initially supported. The subsequent public fallout over Trump’s spending bill led to Musk criticizing Trump and Trump threatening SpaceX contracts.
- Tesla (TSLA): Facing boycotts, protests (some involving vandalism), declining sales, and intense competition.
- SpaceX: Mentioned as leverage during the Trump/Musk spat, as Trump threatened to terminate government contracts critical to NASA missions.
5. Regulatory/Policy Discussion:
- Doge Commission: The Department of Government Efficiency (Doge) was established via executive order as an advisory body outside Congress, tasked with cutting federal spending, leading to mass deferred resignation offers for federal employees.
- Tariffs: Trump’s proposed tariffs on China create complications for Tesla, despite Musk’s prior belief that Tesla would be minimally affected.
- Self-Driving Regulation: The episode notes that crash reporting requirements and regulations around self-driving technology are reportedly being relaxed, coinciding with Tesla’s push for Robotaxis.
6. Future Implications: The second half of 2025 is positioned as potentially transformative for Tesla, hinging on the successful launch of the Robotaxi service and the rollout of a more affordable entry-level EV model (likely a simplified Model Y). The cessation of the high-profile political feud suggests Musk can refocus efforts, which should be bullish for the stock, provided execution remains on schedule.
7. Target Audience: Investment Professionals, Automotive Industry Analysts, and Tech Strategists interested in the intersection of CEO influence, corporate branding, and high-growth technology stock valuation.
Comprehensive Summary
The podcast details a turbulent period for Tesla, driven primarily by the public persona and political maneuvering of Elon Musk. The narrative begins by establishing Tesla’s poor stock performance, linking it to sluggish EV sales, Chinese competition, and, critically, Musk’s alignment with Donald Trump.
A key discussion point was the Department of Government Efficiency (Doge), an advisory body established by Trump, which Musk publicly supported due to its acronym. Musk’s involvement, alongside his right-wing political leanings, alienated Tesla’s traditionally progressive customer base, fueling protests and a “Tesla take-down movement” that included vandalism and stock divestment calls.
Operationally, Tesla reported severe Q1 2025 results, with profits down over 70%. This financial pain was compounded by supply chain issues related to Trump’s proposed tariffs on China, where competitors like BYD are rapidly gaining market share.
The turning point discussed was Musk’s decision to step back from Doge to focus on Tesla, which initially caused a stock rally. However, this was immediately overshadowed by a massive public falling out between Musk and Trump over Trump’s proposed spending bill, which Musk deemed an “outrageous pork-filled congressional spending bill.” This spat led to mutual insults, threats regarding SpaceX government contracts, and two subsequent analyst downgrades for TSLA, indicating the stock is now priced based on Musk’s volatility rather than core business metrics.
Looking ahead,
🏢 Companies Mentioned
💬 Key Insights
"Musk has even said that Tesla's energy business could eventually surpass its automotive division in importance and revenue, which is just nuts to think about."
"The very public spat led to Tesla's stock being downgraded twice by analysts at August Research and Baird. Argus analysts noted that the company shares are now trading on factors unrelated to its fundamentals."
"The clash then escalated as the two began exchanging posts about the US government's contracts with SpaceX... Trump suggested that contracts could be terminated, prompting Musk to threaten the decommissioning of the Dragon spacecraft..."
"Musk then went all in on Trump in a post that's since been deleted, saying that, 'Donald Trump is in the Epstein files. That is the real reason they have not been made public.'"
"EV companies there [China] are starting to eat into Tesla's market share. The likes of BYD and Jetore are churning out models that are not only cheaper but, in many cases, arguably better than those Tesla currently produces, which perhaps poses an even greater threat to the company than Musk's shenanigans."
"Tesla reported a 20% drop in car sales compared to the same period last year and declared that profits had fallen by more than 70%."