Tesla estimates cut further on ‘unprecedented brand damage’, backlash against Musk cited

One of Wall Street’s most bearish Tesla analysts further reduced estimates for the company’s earnings, citing the magnitude of car-buyer backlash against chief executive Elon Musk.

Tesla’s first-quarter vehicle deliveries were far below even JPMorgan Chase & Co analyst Ryan Brinkman’s pessimistic estimate, “confirming the unprecedented brand damage we had earlier feared”, he said in a report on April 4.

The sales report “causes us to think that – if anything – we may have underestimated the degree of consumer reaction”, Mr Brinkman wrote.

Tesla shares fell more than 5 per cent before the start of regular trading on April 4. The stock has slumped 44 per cent since hitting a record high on Dec 17, 2024.

Tesla delivered 336,681 vehicles in the first three months of 2025, its worst quarterly total since 2022.

In addition to changing over production lines at each of its assembly plants to build the redesigned Model Y, the automaker was contending with Mr Musk becoming a more polarising figure due to his interventions in global politics.

JPMorgan now expects Tesla’s first-quarter earnings to slip to 36 US cents a share, short of its previous projection of 40 US cents and analysts’ average estimate of 46 US cents.

Mr Brinkman also trimmed his full-year projection to US$2.30 a share.

Analysts surveyed by Bloomberg are on average estimating the company will earn US$2.70 per share – and Mr Brinkman notes that this figure has dropped 17 per cent since Tesla last reported quarterly earnings in late January.

Mr Musk is

expected to step back

from his role leading the initiative known as the Department of Government Efficiency once his 130-day period as a temporary adviser to US President Donald Trump has lapsed, Bloomberg reported on April 3.

But the billionaire will still wield significant influence over

the federal cost-cutting effort

and remain a Trump confidant after his formal departure, according to people familiar with the matter.

The Tesla CEO is a special government employee, a classification for temporary federal hires who are supposed to work only 130 days out of the year in their roles.

A formal date has not been set for Mr Musk to leave, and the White House counsel’s office is in charge of determining when he has worked his 130 days, the people said.

After emerging as Mr Trump’s biggest contributor in the US presidential election, Mr Musk set his sights on Europe early in 2025, attacking more mainstream political figures and aligning with far-right parties and activists. That has backfired for Tesla – sales plummeted 62 per cent last quarter in Germany, home to the company’s only vehicle-assembly plant on the continent. BLOOMBERG