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Tesla CEO Elon Musk’s recent politics have cost the company millions of car sales, according to an October report published by the National Bureau of Economic Research.
If not for the “Musk partisan effect,” as it is referred to by researchers, Tesla would have sold an additional 1 to 1.26 million vehicles in the U.S. from October 2022 to April 2025. That translates to tens of billions in revenue that never came in. In fact, moving those additional cars would have boosted the company’s sales by a massive 67 to 83 percent—and California likely would have reached its 2026 target of 35 percent zero-emission vehicles market share.
The political activity at hand refers to Musk’s donating around $300 million to Republican candidates, leading the Department of Government Efficiency (DOGE) under Trump, and his handling of X.
The report tracks Tesla’s sales before and after Musk’s acquisition of Twitter in October 2022. Pre-acquisition, Democrat-heavy counties preferred Teslas more often than Republican counties. Afterwards, however, there was a noticeable shift away from Tesla purchases in those Democratic counties.
As per the study, Musk’s behavior “antagonized his most loyal customer base,” as it’s more often left-leaning buyers interested in EV. Those buyers haven’t stopped purchasing completely. Rather, the report recorded a boost of around 17 to 22 percent in sales of competitors’ electric and hybrid vehicles.
On the flip side, Republicans don’t seem more interested in Tesla. According to a survey cited in the NBER report, “Musk’s public persona over the last two years has significantly reduced liberal and Democratic support for Tesla without increasing conservative and Republican support.”
The data proves Tesla is no longer just a car company, but a political statement. And it’s because of Musk’s public involvement in politics. It’s a rising trend in top companies, like Spotify losing artists due to the CEO’s support for AI military company Helsing, and the Starbucks boycott related to the company’s stance in the Israel-Palestine conflict.
What’s left to watch is Tesla’s future sales, especially as it continues to roll out its robottaxi service across the US.
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Ava Levinson
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