Falling sales figures

Elon Musk’s image puts off Tesla buyers

According to experts, it is "very likely that Musk himself is contributing to the decline of Tesla's reputation".

(Bild: 2015 Getty Images)

Opinions are divided about Tesla boss Elon Musk: while some celebrate the enterprising businessman, others are critical of him due to his politically right-wing comments and brutal management of his social media platform X. According to US market researcher Caliber, Tesla's "Consideration Score", an indicator for measuring consumer interest in a brand, fell to 31 percent in February. Tesla had reached its highest level of 70 percent in November 2021.

The success of the electric car pioneer from the USA had been unchecked for a long time. However, according to experts, this has changed. According to market researchers, this is also due to the strong connection between Tesla's image and that of Musk. "It is very likely that Musk himself is contributing to the decline in reputation," said Caliber CEO Shahar Silbershatz. Because for four out of five Americans, Musk is Tesla's figurehead. The car manufacturer did not respond to a request for comment.

Increasingly put off
In the US, a survey by consumer research firm CivicScience, available to Reuters, found that 42% of respondents had an unfavorable view of Musk in February, compared to 34% in April 2022, when Musk announced his investment in Twitter. "A modest but growing number of e-car buyers are increasingly put off by Elon Musk's behavior and policies and are now looking for viable alternatives to Tesla in the marketplace," said Ed Kim, president of California-based consulting firm AutoPacific.

In the first quarter, Tesla sales fell for the first time in four years, contrary to market expectations, by 8.5 percent compared to the same period last year to just under 387,000 cars.

(Bild: APA/AFP/POOL/Patrick Pleul)

Sales fall for the first time
The fact that the potential Tesla buyer base is shrinking may also be due to the car manufacturer's ageing model range. According to Musk, the market environment for electric cars has also deteriorated due to high interest rates, which make loans to buy a car more expensive. While Tesla alone lost eight percentage points on Caliber's sentiment barometer in January, the scores of German premium manufacturers Audi, BMW and Mercedes-Benz improved to between 44 and 47 percent in the USA.

Despite further price reductions, Tesla sales in the first quarter fell for the first time in four years, contrary to market expectations, by 8.5 percent compared to the same period last year to just under 387,000 cars.

Consumer attitudes vary from region to region: in the USA, Canada, the UK, France and Sweden, popularity ratings fell according to data from market research firm Brand Finance. In Germany, on the other hand, where Tesla operates a plant in Grünheide near Berlin, and also in China, the car manufacturer gained in popularity.

"Reasonably popular"
Musk's striking personality has benefited Tesla thanks to his declared fight against climate change by promoting electromobility. The elegant, digitally sophisticated cars outperformed gas guzzlers. Tesla rapidly evolved from a niche manufacturer to a heavyweight and the world's most valuable carmaker on the stock market. The company used to be able to save money on advertising or press work, as Musk himself constantly caused a sensation as the boss. That has since changed.

However, his support for the Republicans in the USA and applause for anti-Semitic comments on X, from which Musk then distanced himself, are worrying financial market analysts with regard to the company. In response to a corresponding question from an investor at the beginning of last year, Musk said he was "reasonably popular", referring to his 127 million followers on X at the time. In November, he explained: "Whether you hate me, like me or are indifferent, do you want the best car or do you not want the best car?"

Loyalty is strong
Tesla's reputation is still excellent among many. The market research company S&P Mobility shows that Tesla has the highest loyalty among the major car brands: A good two-thirds of Tesla owners remain loyal to the brand when they buy a new car. Christian Cook, a Texan who owns a Model 3 and describes himself as politically right-wing, says that Musk's actions make no difference. He personally doesn't care about the "stupid" criticism.

Kat Beyer, a climate activist from Wisconsin, decided to buy a Model Y last year despite Musk. The reliable charging infrastructure was the deciding factor. "It's hard to drive the car that's associated with him," said Beyer. "But I can't go back to the gasoline car."