Washington, D.C. – Tesla CEO Elon Musk announced during an earnings call that he plans to reduce his involvement in running President Donald Trump’s Department of Government Efficiency starting in May. Musk, who has faced challenges with Tesla’s stock dropping over 40% this year, stated that he will still support the president with DOGE, a project aimed at eliminating waste and fraud in the federal government. Despite spending nearly $300 million in the 2024 campaign to help reelect Trump, Musk’s focus will shift away from government issues as Tesla works to overcome disappointing first-quarter results, including a decline in automotive revenue and net income.
Musk’s decision to step back from his government role follows growing concerns over protests and potential damage to Tesla’s brand due to his ties to Trump and support of Germany’s far-right AfD party. The protests, which Musk claims are organized and potentially fueled by fraudulent motives, have added pressure to the company already facing competition from China and dealing with an aging fleet of electric vehicles. While DOGE boasts about billions in savings resulting from its cuts, the accuracy of these claims has been questioned, especially as Tesla’s market cap has seen significant losses over the same period.
The Department of Justice defines Musk as a “special government employee,” allowing for fewer conflict-of-interest disclosures and ethics policies due to a limited term of service. As Musk approaches the end of the 130-day limit set by the Trump administration, job cuts resulting from DOGE’s work have been reported across various government agencies. Concerns have arisen over DOGE’s actions at the Department of Education, where staffers rearranged offices and possibly accessed federal student loan data. Additionally, the Trump administration’s decision to merge USAID under the State Department has raised further questions about the impact of DOGE’s initiatives on government operations.
Despite the challenges faced by Tesla and Musk’s evolving role in government affairs, the company continues to navigate through a turbulent period in the automotive industry. As Musk reassesses his priorities and commitments, the future of both Tesla and DOGE remains uncertain, with implications for the broader landscape of government efficiency and private sector initiatives.