Key Takeaways
- Wedbush Securities’ Dan Ives has called for Elon Musk to step back from the Department of Government Efficiency (DOGE).
- Ives warned that Musk’s DOGE work could cause permanent harm to Tesla’s reputation.
- Others have suggested that Musk should step down as Tesla’s CEO.
A prominent stock analyst has warned that Tesla CEO Elon Musk risks doing permanent damage to the brand’s reputation.
Ahead of Tesla’s quarterly earnings presentation on Tuesday, April 22, Musk’s association with Donald Trump and the Department of Government Efficiency (DOGE) has investors worried.
“Musk Needs To Leave the Government”
With Tesla stock (TSLA) down nearly 40% since the beginning of the year, even the company’s fans on Wall Street have adjusted their outlook.
One such analyst is Wedbush Securities’ Dan Ives, who has historically been bullish on Tesla’s prospects.
Earlier this month, however, Ives downgraded his price target for the stock from $550 to $315.
In a recent client note, Ives’s diagnosis of Tesla’s problems was blunt: “Musk needs to leave the government, take a major step back on DOGE, and get back to being CEO of Tesla full-time,” he stated.
He assessed that the firm faces “potentially 15%-20% permanent demand destruction for future Tesla buyers due to the brand damage Musk has created with DOGE.”
Damage Already Done
It can be difficult to disentangle the Musk effect from broader, macroeconomic factors that weigh on Tesla’s performance, but there is mounting evidence that a movement to boycott the brand is working.
Compared to the same period in 2024, Tesla’s first-quarter deliveries declined by 13%.
Tesla’s problems have been compounded by Donald Trump’s trade agenda, which prompted the firm to suspend exports to China.
Meanwhile, once the full impact of tariffs is factored in, the cost of a new Tesla made in the U.S. could rise by as much as $4,000, potentially hurting sales even more.
Calls for Musk to Resign
Given Musk’s highly public politics and his tendency to stoke controversy on X, even if he were to step back from DOGE, it may not be enough to salvage the Tesla brand.
For his part, Ives acknowledged that Musk may have already caused permanent reputational damage to Tesla. But, as long as he ceases working for the Trump administration:
“Tesla will have its most important asset and strategic thinker back as full-time CEO,” the Wedbush analyst reasoned.
Others are less optimistic.
Having concluded that Musk remains fully committed to the DOGE project, California-based wealth manager Ross Gerber has called for the Tesla CEO to step down from the helm of the company.
“I think Tesla needs a new CEO,” he stated recently, adding that “the business has been neglected for too long.”
James Morales is CCN’s blockchain and crypto policy reporter. He has been working in the news media since 2020, writing about topics such as payments, banking and financial technology. These days, he likes to explore the latest blockchain innovations and the evolving landscape of global crypto regulation.
With an educational background in social anthropology and media studies, James uses his platform as a journalist to explore how new technologies work, why they matter and how they might shape our future.
