Elon Musk Resigns as Trump Adviser Amidst Tesla’s Struggles in Europe

Elon Musk’s recent decision to step down from his role as a top adviser to President Trump was announced on Wednesday. This departure comes as Tesla faces significant challenges in the European market, where sales dropped by 49% in April compared to the same month last year.

Decline in Tesla Sales

According to the European Automobile Manufacturers’ Association (ACEA), Tesla sold 7,261 vehicles across 32 European countries last month. This stark decline is in contrast to the healthy growth of other battery electric vehicles, which saw sales rise 28% in the same period.

Significant Decrease in Sales

• Year-to-date sales for Tesla in Europe are down nearly 40% compared to the previous year.
• Specific countries such as Sweden experienced a 42% drop, while Norway and Denmark each saw declines of 48%.

This sales slump comes at a time when competition in the electric vehicle (EV) sector is intensifying. Chinese automaker BYD has now taken over as the leading seller of pure electric cars in Europe, with sales soaring 54% in April alone.

Musk’s Political Exit

Musk’s tenure in the Trump administration, where he served as the de facto head of the Department of Government Efficiency, has been tumultuous. During a recent investor call, he revealed that Tesla’s profits plummeted by 71% in the first quarter of 2025.

Impact of Political Involvement

• Musk’s involvement in politics has drawn criticism and resulted in lower performance for Tesla.
• His initial plan to cut spending dramatically decreased from $2 trillion to $150 billion.
• He faced political backlash, particularly for endorsing the AfD party in Germany, exacerbating tensions within the EU.

Evolving Market Trends

The shift in consumer preferences is further complicating Tesla’s positioning in the European market:

• Sales for hybrid electric vehicles made up over 35% of the total car market in Europe in April, according to ACEA data. Tesla does not offer any hybrid models, focusing solely on fully battery-powered vehicles.
• Traditional automakers are increasingly expanding their electric and hybrid offerings, posing additional pressure on Tesla’s market share.

Public Backlash and Infrastructure Challenges

Tesla’s challenges extend beyond sales. The company has faced a wave of vandalism, including arson incidents targeting charging stations and graffiti attacks on Tesla cars and dealerships. Many Tesla owners have reported seeing their vehicles tagged with offensive graffiti, further damaging the brand’s reputation.

Investor Concerns

The backlash against Musk’s political choices has prompted significant concerns among investors. For instance:

• Lehigh County, Pennsylvania, has become the first American pension fund to halt new Tesla stock purchases, blaming Musk’s political aspirations for compromising the brand.
• Earlier this year, 51 legislators from New York called for the liquidation of the state’s $1 billion Tesla holdings.

Conclusion

Elon Musk’s resignation from his advisory role marks a critical moment for both him and Tesla as the company grapples with a sharp decline in European sales amid fierce competition and growing public discontent. The intersection of business and politics has proven to be a challenging arena for the tech mogul, raising questions about the future trajectory of Tesla in an increasingly competitive market.

For more insights on Tesla’s market dynamics and the challenges they face, check out the full report by the European Automobile Manufacturers’ Association and updates from industry analysts.