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How Elon's Politics Torched a Million Tesla Sales · Elon Musk Podcast

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  Yale economists estimate Elon Musk's political activities cost
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  Tesla between 1,000,000 and 1.26 million U.S. sales from October
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  2022 through April of 2025. Now the timing lines up with his
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  acquisition of Twitter, which is now X of course, and his move
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  into national politics. The data shows a sales hole that
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  would not exist without the Musk partisan effect, which is how
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  the researchers describe the pole of politics on purchasing.
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  Now, how does the CE OS personal brand reshape the demand curve
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  for Tesla vehicles? We're going to look into that
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  today. The question sits on clear
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  facts, though. The working paper comes through
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  the National Bureau of Economic Research and uses county level
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  registrations to isolate the effect.
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  The authors attribute the gap to Musk's public alignment with
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  Republican politics in his high dollar donations, which shifted
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  a customer base that skewed Democratic.
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  Now the basic of this paper that quantifies the gap directly.
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  The Tesla's US unit sales would have come in 67 to 83% higher
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  over that 31 month window without that part to set effect.
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  The approach tracks monthly registrations and compares
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  places where Democrats or Republicans dominate, which
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  cleanly separates politics from other market drivers.
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  Now the researchers find a matching boost for competitors.
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  Electric and hybrid sales at rival brands rose thoroughly, 17
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  to 22%, as Democratic leaning buyers moved away from Tesla,
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  and the shift shows how brand perception migrates to the
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  nearest substitute when values enter the purchase decision.
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  The effect shows up vividly in California.
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  Registrations fell 9.4% in the first quarter, while Tesla's
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  share slid to 46.2%, and the paper argues that the state
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  likely would have hit its 20260 emissions sales targets absent
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  the partisan effect. California's role this Tesla's
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  largest U.S. market turns that drop into a core business
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  problem. Now, operational data from
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  earlier this year points in the same direction.
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  Tesla's global deliveries dropped 13% in the first quarter
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  of 2025 as aging models, rising competition and brand pushback
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  weighed on demand. And those numbers set the stage
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  for the Yale analysis by showing pressure before the model lineup
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  meaningfully changed. In the paper links part of the
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  demand shift to Musk's high profile government role.
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  His time leading the Department of Government efficiency during
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  President Trump's term amplified partisan cues that many Tesla
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  buyers disliked. That alignment create a
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  political filter on an otherwise tech forward car purchase.
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  Researchers also track how sentiment drift interacts with
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  product strategy. They note a mild improvement
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  when Tesla talked more about robo taxis and humanoid robots.
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  But the perception lift did not close the sales gap.
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  The narrative change moved opinions at the margin, while
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  price cuts did most of the near term work.
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  Now the ownership story connects to the government story.
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  Tesla's chair warned that Musk could exit if investors reject
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  his pay package. That headlines at a trillion
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  dollar figure, which adds leadership risk on top of demand
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  risk. And that warning puts boardroom
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  dynamics on the same stage as sales math.
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  Competitors fill the opening with speed and focus.
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  Buyers who left Tesla favored hybrids and EVs from Ford,
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  Hyundai, Kia, GM and Rivian, which offered fresh models and
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  less political baggage. And those flows match the
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  study's estimate of gains for rivals.
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  And they show how preference can flip when customers feel value
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  alignment elsewhere. You know the public narrative
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  matters because it now shapes purchase intent at the county
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  level. The study's method captures how
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  partisanship predicts EV choice after controlling for other
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  variables, which is rare in automotive research at this
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  scale, and the results gives executives and investors A
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  quantifiable measure of how public politics map to private
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  buying. Tesla now faces a marketing
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  problem tied to a leadership decision and problem.
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  The brand must either neutralize the political signal or Elon or
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  out innovate the perception tax that the paper measures.
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  This is getting in the hands of every single investor in Tesla
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  over the next few days. And when the vote comes up for
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  Elon's trillion dollar pay package, this is going to weigh
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  on all of them. And the company's next sales
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  reports will show whether strategy or sentiment moves
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  first. Now this data links Musk's
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  political profile to a measurable million unit sales
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  gap for Tesla in the US market. And if anybody that invests in
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  Tesla doesn't see that now, they will.
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