Goodwill is circling the drain

Tesla's ugly month just got even worse

By Stephen Council

Over the past decade, Tesla steadily built up its cred as a top-tier manufacturer, a stock market juggernaut and a symbol of green energy’s promise. Now, that goodwill is circling the drain.

The Elon Musk-led company, which boasts a flagship factory in Fremont and an engineering headquarters in Palo Alto, is having a historically horrible month. Key sales markets are slumping. Longtime fans and influencers are changing their tunes. Customers are being insulted. A competitor is touting a key breakthrough. Investors, who for years granted Tesla a tech-style valuation rather than one closer to its rival automakers, stripped hundreds of billions of dollars from that market cap in February and early March.

J.P. Morgan auto analyst Ryan Brinkman wrote in a March 12 note: “We struggle to think of anything analogous in the history of the automotive industry, in which a brand has lost so much value so quickly.”

All that woe came before Thursday, when the National Highway Traffic Safety Administration revealed a fresh embarrassment. Tesla is telling the owners of 46,096 Cybertrucks — basically every single one of the boxy, metallic vehicles on the road — that their $79,990-and-up cars need a fix. The recall document says that an exterior panel on every Cybertruck’s trim is stuck on with “structural adhesive,” or a kind of glue, and can fall right off. It’s the Cybertruck’s eighth recall since its late-2023 launch.

But much of Tesla’s current crisis has little to do with the build on its cars, and a lot to do with Musk, who joined the company shortly after its 2003 founding. When President Donald Trump began his second term in January, Musk charged into Washington, D.C., and began attempting a slash-and-burn overhaul of the federal government, complete with mass layoffs and hits to popular government programs. His role — as an unelected billionaire trying to tear down parts of government that historically have been erected by congresspeople and staffed by civil servants — is rankling many on the left.

Tesla, for many Musk critics, emerged as an easy target. Country music star Sheryl Crow ditched the brand, and after Musk called Sen. Mark Kelly a “traitor” over his visit to Ukraine, the war veteran followed suit. Protests at showrooms, where attendees hold up signs encouraging a boycott, have garnered thousands of attendees across the country. 404 Media reported that protesters running a site called “Dogequest” attempted to push Tesla owners into selling their vehicles by posting their information online. Police around the country are reporting vandalism — Trump threatened domestic terrorism charges for perpetrators at a March 11 photo op with Musk and a few Tesla vehicles at the White House.

The tie of Tesla to an unpopular Musk isn’t just a political issue; it’s bad financial news for the company. Tesla sales plummeted in Norway, France and Germany this February, per the New York Times. In liberal California, the United States’ largest electric vehicle market, Tesla’s top-selling Model Y slumped in popularity late last year, Bloomberg reported. And New York magazine’s Intelligencer pointed out Thursday that several popular and political-drama-averse YouTubers seem to have tamped down the Tesla praise they once laundered to their massive audiences.

But Musk’s politics are far from the company’s only problem. News outlet Electrek reported Monday that the prices of used Teslas are badly underperforming compared with other cars, which could scare away potential new car buyers. BYD, China’s largest electric vehicle maker, bragged on Monday that its new tech can fill up a vehicle’s charge in five to eight minutes — faster than even Tesla’s Superchargers. BYD doesn’t sell in America, but any market share wins for the company in China almost certainly mean losses for Tesla.

By comparison, Tesla’s victory of the month — the company got a permit to begin driving around passengers in California — looks paltry. The company is still mega-valuable, with cars that have long been popular for their look, feel and no-gas design. But 2025, so far, is rough riding.

Tesla did not respond to SFGATE’s request for comment.