Elon Musk’s increasing involvement in global politics has sparked concerns among financial analysts regarding the future of Tesla. Recent incidents involving vandalism against Tesla dealerships and vehicles have raised questions about consumer confidence. Ben Kallo, an analyst at Baird, expressed worries on CNBC’s “Squawk on the Street” that such events could deter potential buyers, even those who support or are neutral towards Musk. The fear of personal property damage may lead to hesitation in purchasing a Tesla. Reports from various regions highlight instances of deliberate damage to Tesla properties, underscoring growing tensions.

Musk’s evolving political stance marks a significant shift from Tesla’s early days. Initially, the company was closely associated with environmental advocacy due to its dominance in the electric vehicle market. However, Musk’s recent alignment with right-wing politics and his advisory role in government efficiency initiatives have altered this perception. This change has particularly affected Tesla’s presence in Europe, where sales have plummeted by 45% in January. Analysts speculate whether this shift is driving away existing customers or attracting new ones who align with Musk’s political views. Despite these challenges, Kallo maintains an overall positive outlook on Tesla’s stock but issued a tactical caution last week, citing overly optimistic profit estimates for the first quarter.

The transition to producing the updated Model Y and the surrounding political controversies may be impacting Tesla’s delivery schedules and sales figures. While it remains uncertain if Musk’s political activities are influencing buyer decisions, the production delays appear to be a more immediate concern. Shares of Tesla have declined significantly, dropping 9% on Monday and losing 40% year-to-date. Other Wall Street analysts, including UBS and Redburn Atlantic, have also voiced skepticism, reiterating their sell ratings on Tesla’s stock. In times of uncertainty, it is crucial for companies to maintain strong consumer trust and adapt to changing market dynamics. Amidst these challenges, Tesla must focus on delivering quality products and addressing any issues that may affect customer satisfaction.