Tesla investors have a lot of questions for Musk about his political activism for Trump
- by NBC Washington
- Oct 23, 2024
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Adding to what Musk has called his "17 jobs," he has also floated the idea to Trump that he should form a "government efficiency commission" to cut spending and slash regulations. Trump has promised to do it and to let Musk effectively lead it.
In his effort to try to push the Republican nominee and ex-president past the finish line in a deadlocked race, Musk embarked on a speaking tour in Pennsylvania to drive voter registration. He called the state the "linchpin" in this election, and Saturday he said he would randomly award $1 million a day to registered voters who sign a petition for his pro-Trump PAC.
While Musk has attracted plenty of media scrutiny for his political views, they've rarely been discussed at company shareholder meetings or in Wall Street analysts' notes.
According to analyst notes compiled by FactSet, which doesn't include all sell-side firms, the topic of Trump and the election has been almost absent from the discussion.
The financial impact of Musk's politics can be hard to quantify.
But at least one venture capitalist and Tesla bull, Deepwater Asset Management's Gene Munster, has given it a shot.
Munster wrote in a note on Oct. 5 that Musk's heightened "political commentary" in the past four months "may have reduced deliveries by 5-10k during the quarter." Munster said that means the company's U.S. numbers would have been 4% higher and total numbers almost 2% higher "if not for the political dynamic."
Tesla didn't immediately respond to a request for comment.
Brand consultancy Interbrand, which has been running a Best Global Brands study for 25 years, found that Tesla's brand value declined 9% this year. Tesla fell in the rankings to the 12th spot, behind automakers Toyota, Mercedes Benz and BMW, which all cracked the top 10.
"Most car manufacturers are grappling with the shift to EVs, and although Tesla was born in that territory, its changing focus is causing market confusion about the strategies it is executing," Interband Global CEO Gonzalo Brujo said in an email to CNBC. "This has not been helped by recent introductions, like the truck falling short as competitors deliver better cars."
The top five brands ranked by Interbrand were all tech companies that compete with Tesla for talent and, in some cases, on products: Apple, Microsoft, Amazon, Google and Samsung.
Tesla's vehicle lineup is full of models that have been around for years, including the still popular Model 3 sedans and Model Y SUV. And the company has been asking investors to focus on its plans for dedicated robotaxis, driverless software, humanoid robots and supercomputers, instead of its core automotive business.
Brujo said Musk's antics could represent a major distraction from all of that.
"A CEO or brand aligning with anything political is taking a risk," he wrote. "It can be polarizing, and the business or brand could risk losing customers as a result."
Tesla shares are down 14% for the year due to an 18% slide in October. The Nasdaq is about flat for the month and up almost 22% this year.
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