Musk shifts focus to rescue Tesla after profit plummet
Elon Musk announced that starting in May, he will dedicate less time to the Department of State Efficiency to focus on managing Tesla. This decision was made after Tesla's profits dropped by 70% in the first quarter of 2025.
What do you need to know?
- Elon Musk announced that starting in May, he will reduce his involvement in the activities of the Department of State Efficiency to focus on Tesla.
- Tesla experienced a 70% drop in profits in the first quarter of 2025, which influenced Musk's decision.
- Musk advised the U.S. president to lower tariffs, even though Tesla has a factory in Shanghai.
Musk distances himself from the White House to focus on saving Tesla
During a conference call with Tesla investors, Musk stated that his responsibilities as the informal leader of the team responsible for cost-cutting and simplifying bureaucracy are largely completed. Starting in May, he plans to spend a maximum of one to two days a week on activities within DOGE (Department of State Efficiency), only as long as his presence is needed and desired by the president.
The billionaire simultaneously announced that he will now focus on leading Tesla, which is facing significant challenges. In the first quarter, the company achieved a profit of $409 million (CAD 565 million)—down 71% from the previous year. As noted by the "New York Times," without revenue from interest and the sales of carbon credits, Tesla would have incurred a loss exceeding $500 million (CAD 690 million).
The decline in the company's results is influenced by factors such as reduced demand for Tesla's electric cars, growing competition from Chinese manufacturers, and image damage resulting from Musk's political involvement.
Tesla's profit decline forces Musk to change priorities
Musk himself admitted that he faces criticism but claims that many activists protesting against his company are "paid." He also noted that he advised the president to lower tariffs, although, in his opinion, Tesla is less exposed to their impact—even though the company's largest factory is in Shanghai, and Reuters recently reported disruptions in the supply of some components from China.
"I've been on the record many times saying that I believe lower tariffs are generally a good idea for prosperity but this decision is fundamentally up to ... the president of the United States. I'll continue to advocate for lower tariffs rather than higher tariffs, but that's all I can do," said Musk.
