Despite taking a hit earlier in the day from weak deliveries, Tesla (TSLA+5.31%) stock is now soaring as Elon Musk’s time in the federal government appears to be nearing an end.
Politico, citing people familiar with the matter, reports that President Donald Trump and Musk have agreed that the Tesla CEO should take on a supporting role, rather than a leadership one, over the next few weeks. Musk will likely stay on informally as an advisor and continue to stay in the president’s orbit, according to the report.
After Musk became Trump’s biggest financial supporter on the campaign trail, the Tesla CEO was given a role leading the Department of Government Efficiency (DOGE), which has been directed to slash government spending. He was named a special government employee, a role that exempts him from some ethics rules — but that only allows such staffers to work for 130 days; the period is set to expire in late May or early June.
“Elon Musk and President Trump have both *publicly* stated that Elon will depart from public service as a special government employee when his incredible work at DOGE is complete,” White House Press Secretary Karoline Leavitt said in a post on Musk’s X (formerly Twitter), replying to the author of Politico’s report.
The reminder of Musk’s limited timeline for officially working in the White House was welcomed by investors. Tesla stock climbed 5% in intraday trading — after falling by about the same amount earlier in the day. The stock is down by more than 25% year-to-date.
Backlash over DOGE has been swift and has grown in recent weeks as the group continues to direct the Trump administration’s approach to downsizing the government. Musk claimed last week that DOGE cuts an average of $4 billion in federal spending each day.
Tesla has become an easy target for protesters angered by Musk’s support of Trump and his work in the federal government. Nonviolent, anti-Tesla protests have been held across the U.S. and other countries, while vandalism against the company’s customers and facilities has ramped up.
“What they’re trying to do is put massive pressure on me and Tesla, I guess, to, you know, I don’t know, stop doing this,” Musk said Sunday. “My Tesla stock and the stock of everyone who holds Tesla has gone, went roughly in half. I mean, it’s a big deal.”
On Wednesday morning, Tesla reported first-quarter sales of more than 336,681 electric vehicles, far less than Wall Street expected. Analysts have been lowering their forecasts for weeks as the “Tesla Takedown” protests have continued. Deepwater Asset Management’s Gene Munster estimates that Tesla lost about 80,000 deliveries as a result of brand damage.
“We are not going to look at these numbers with rose-colored glasses…they were a disaster on every metric,” Wedbush Securities analyst and Tesla bull Dan Ives said in a Wednesday note. “The more political [Musk] gets with DOGE the more the brand suffers, there is no debate.”
“The future is so bright but this is a full blown crisis Tesla is navigating now and its primarily self-inflected,” he added.
The post Tesla stock soars as Elon Musk’s time at DOGE nears an end appeared first on Quartz.
