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Gizmodo
6 days ago
- Automotive
- Gizmodo
Tesla's Nightmare Continues As Musk Warns of 'Rough Quarters'Ahead
Tesla's second-quarter earnings paint a grim picture: falling profits, slumping sales, and a reputation hit that keeps on hurting. The all-electric carmaker reported net income of $1.17 billion, down 16.3% from the same period in 2024. Revenue fell 12% to $22.5 billion from $25.5 billion a year earlier, marking Tesla's second consecutive quarter of declining profits and revenue this year. The cause is clear: Tesla is selling fewer cars and cutting prices to chase demand. Deliveries fell 13.5% in the second quarter, showing how steep the drop has been. Tesla's troubles are about more than economics. CEO Elon Musk has become one of the most polarizing figures in the corporate world. His political pivot—spending nearly $290 million to help Donald Trump return to the White House in 2024 and later joining Trump's administration as head of the Department of Government Efficiency (DOGE)—sparked global backlash. The infamous DOGE began aggressively cutting federal agency budgets, sparking protests outside Tesla showrooms worldwide and, more importantly, alienating the company's core customer base. By becoming a prominent face of the administration and championing right-wing causes, Musk has pushed away the liberal buyers in the U.S. and Europe who once formed the bedrock of Tesla's support. Sales took a hit. Musk resigned from DOGE in May to refocus on Tesla, but the damage lingers. Adding to the drama, he recently launched a new political party, the American Party, vowing to field candidates in the 2026 midterm elections after falling out with Trump. 'We probably could have a few rough quarters. I'm not saying that we will, but we could,' Musk admitted on the earnings call with analysts. Tesla Isn't a Car Company Anymore The road ahead looks brutal. President Trump's 'One Big Beautiful Bill,' signed on July 4, kills the $7,500 federal EV tax credit as of September 30. That means Teslas are about to get pricier. The same law scraps clean-air penalties for automakers who fail emissions standards, ending a key Tesla revenue stream from selling regulatory credits to competitors. In Q2, those credit sales were slashed nearly in half, falling to $439 million from $890 million a year earlier. 'The One Big Beautiful Bill has a lot of changes that would affect our business in the near term,' CFO Vaibhav Taneja told analysts. Tesla, which manufactures most of its U.S. cars in Fremont, California, and Austin, Texas, still relies heavily on imported raw materials and components, leaving it vulnerable to tariffs. 'We started seeing the impact of tariffs,' Taneja said. 'Sequentially, the cost of tariffs increased around $300 million with approximately two-thirds of that impact in automotive and the rest in energy. However, given the latency in manufacturing and sales, the full impact will come through in the following quarters.' He warned: 'Costs will increase in the near term. While we are doing our best to manage these impacts, we are in an unpredictable environment on the tariff front.' Waymo Is Crushing Tesla in the Robotaxi Race The combination of slowing demand, price cuts, disappearing EV incentives, and rising tariffs suggests Tesla's earnings pain isn't going away soon. But on Wednesday's earnings call, Musk once again pitched his vision of Tesla's future, not as a car company, but as a robotics and AI powerhouse built on humanoid robots, automation, and self-driving tech. The problem? Tesla's late-June robotaxi launch in Austin showed how far behind it is. Waymo, Google's self-driving subsidiary, already operates fully autonomous robotaxis across multiple U.S. cities and covers more than twice Tesla's Austin service area. Tesla's small fleet, meanwhile, is invite-only and still requires a human supervisor in the passenger seat.
Yahoo
22-07-2025
- Automotive
- Yahoo
Is Musk's Political Pivot Good for Tesla? Experts Weigh In
It's been a rough ride for Tesla (TSLA) over the past few months. As CEO Elon Musk focused his attention on the Department of Government Efficiency (DOGE), Tesla's company and stock saw some dramatic volatility. Musk left DOGE in May and committed to focusing on Tesla. Since then, however, he had a public blowout with President Donald Trump and is now talking about forming a political party called the American Party, according to a post he wrote on X, which is creating chaos for the brand and uncertainty for investors. Read Next: Explore More: While Musk redefined the car industry, his avid political interests have shaken up the market and spooked investors. Read on for experts' take on whether Musk's pivot is good for the company and the stock. How Musk's Political Aspirations Impacted Tesla In the first quarter, electric vehicle (EV) sales increased more than 11% year over year, per Cox Automotive, but Tesla hasn't been riding that wave. Tesla saw its sales fall, and many attributed that, in part, to Musk's political involvements earlier this year. In the company's first quarter earnings release, it reported that net income fell by 71% year over year, per NPR, and in the second quarter, it reported that sales plunged a record 13.5% year over year, per CNN. Its stock also saw a lot of volatility during this time. On the first trading day of 2025, Tesla stock closed around $380. By the end of March, it had fallen to around $260. It has since recovered some of those losses and is trading around $330 as of July 22. 'When Musk got into politics, it created confusion for investors,' said Gilbert Michaud, Ph.D., assistant professor of environmental policy at Loyola University Chicago. 'When he removed himself from DOGE, things got better.' However, Musk is still involving himself in politics and offering criticisms of the president on social media, which has led to more volatility in the stock. Check Out: Musk Could Still See Backlash From Investors Investors expect a strong visionary at the helm of a company to guide it to success, and Musk was that trailblazer, but some people are now questioning his choices. 'Every time Musk leans heavily into politics, Tesla's stock tends to react and not always positively,' according to Michael Foguth, founder and president of Foguth Financial Group. 'Investors typically want leadership that's focused on operations and innovation, not controversy. His new political party initiative could become a distraction and raise concerns over long-term vision and brand stability.' 'Musk's personal brand creates uncertainty for many. If Musk weaves his way back into politics or anything else that is perceived as risky, some backlash may occur,' Michaud said. Is Musk Still the Right Fit for Tesla? Musk's behavior is playing out on a global stage, and it's making some people nervous and skeptical that he can continue to lead Tesla. 'While Musk built Tesla, he may not be the right face for its next chapter,' Michaud said. 'The pivot into politics has definitely alienated many consumers and investors, and the company may want to be more disciplined and strategic in its next moves, especially if he forms a new political party.' And the question people are asking is whether Musk is still good for Tesla. 'Yes, in terms of innovation and brand,' Foguth said. 'But the more he strays from that lane, the greater the volatility risk for shareholders. Musk Still Has an Impact on Tesla 'Musk's influence on Tesla is still significant,' Foguth said. 'His technological vision has created massive shareholder value.' However, Musk's lack of commitment to Tesla could cost him a lot more over time. 'If politics continues to dominate headlines, it could erode investor confidence, especially among ESG investors or those with short time horizons,' Foguth explained. It's undeniable that Musk reimagined what a car could be like and completely transformed the driving experience for countless consumers, but his recent involvements and politics have caused the company some trouble. While he has since committed to spending more time at Tesla, it remains to be seen what's in store for the company and stock going forward. Editor's note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on More From GOBankingRates Mark Cuban Tells Americans To Stock Up on Consumables as Trump's Tariffs Hit -- Here's What To Buy This article originally appeared on Is Musk's Political Pivot Good for Tesla? Experts Weigh In
Vox
20-07-2025
- Business
- Vox
What it would take to escape the two-party system
Earlier this month, Elon Musk said he wanted to form a new political party. He'd been teasing the idea ever since clashing with President Donald Trump over his 'big, beautiful bill,' which Musk accused of exploding the deficit. In June, Musk ran a poll on X asking users whether it was 'time to create a new political party in America that actually represents the 80% in the middle?' More than 5 million people responded, and 80 percent voted yes. Then, on July 5, Musk announced he was forming the American Party in hopes of giving voters their 'back [their] freedom.' Those who follow Musk closely, like Bloomberg Businessweek national correspondent Joshua Green, have said Musk's latest project is in line with his pursuit of political power and attention. 'I think he thought he'd essentially bought that by backing Donald Trump to the tune of $300 million in the last election,' Green said previously on Today, Explained. 'And Trump turned on him, ousted him, took away his EV tax credits, didn't cut the deficit, trashed him on social media. And now I think Elon is humiliated and looking for a way to respond and hit back.' Trump has called Musk's third-party proposal 'ridiculous.' And the billionaire appeared to have moved from his third obsession by mid-July — at least on X — posting instead about Europe's fertility rate and running damage control for the antisemitic rants of his AI platform Grok. But regardless of whether he follows through on the 'America Party,' Musk appears to have hit a chord with an American electorate disillusioned by the two-party system. On Today, Explained, co-host Noel King dove into voters' desires, the history of third parties, and possible solutions to the two-party stranglehold with Lee Drutman, senior fellow at the New America think tank and author of Breaking the Two Party Doom Loop: The Case for Multiparty Democracy in America. Below is an excerpt of their conversation, edited for length and clarity. There's much more in the full episode, so listen to Today, Explained wherever you get podcasts, including Apple Podcasts, Pandora, and Spotify. You are not a big fan of the two-party system. You know, I think it's outlived its usefulness. I think America is a pretty big, diverse country these days, you may have noticed. And to fit everybody into just two parties seems like kind of insanity, and it's clearly not working. Also, it has divided this country into two teams — the red and the blue team — that have learned to absolutely hate each other. It's created these artificial divisions around this zero-sum, winner-take-all electoral politics that is just really breaking down the foundations of democracy in this country. So, I think there was a time when it worked reasonably well for certain reasons, but that time is in the past. You will know that Elon Musk agrees with you. He says he wants to start a third party. He ran one of his polls [on X], and the question was: 'Is it time to create a new political party in America that actually represents the 80% in the middle?' I'm looking at that poll now. Eighty percent of people said yes, 20 percent said no. How does that match up with reality in the US? Well, there are two parts to that question. One is: How many people want a third party? And then two is: How many people want that party to be somewhere in the middle? Now, the first part: How many people want a third party? That 80 percent is a little bit high. There might be some selection bias there, but it is close to polls that I've seen. Generally, about 60 to 70 percent of Americans say there ought to be more than two parties when polled. So, overwhelmingly, Americans say they want more than two parties. Now, is the party that they want a party in the center? That's less clear. I think people's perception of the political center depends on themselves. [Most] people think that they're more reasonable and they're more moderate. But in reality, when you look at the viewpoints of the American electorate, as I've done repeatedly, you see that the support for a genuine center party is limited to maybe 10 to 15 percent. But there is a lot of interest in parties that are maybe not as traditional. Third-party candidates do run for office all the time in the United States, they very rarely win. If so many voters want more options, why don't we have more people in elected office from third parties? Here you're hitting on the core problem, which is that we have a single-winner system of elections. So in a single-winner election, third parties become spoilers and wasted votes, because one of the two major parties is going to win every election. So, voting for a third party is just basically a protest vote, or maybe it could spoil the election. And as a result, most people don't want to do that because they think, well, I want to vote for somebody who at least has a chance of winning. And, more importantly, people who have ambition in politics say, well, I'm not going to waste my time with one of these fringe parties. I want to actually win. So you get minor parties that are mostly cranks and weirdos and people say, well, I'd like to vote for another party, but not that third party. What's the recent history of third-party candidates? Serious third-party candidates at a national level? I have a vague memory of Ross Perot, but I couldn't give you many details. It was the nineties. How serious have third-party candidates been over time? Well, Ross Perot is the most recent third-party candidate to actually get a pretty decent share of the electorate. He got almost 20 percent of the electorate, although he didn't win a single state. A lot of people remember Ralph Nader in 2000, who only got about 3 percent of the vote, but it was a very well placed 3 percent because his votes were more than the difference between Bush and Gore in Florida and a few other states. Before that, you had George Wallace running in 1968 on the American Independent Party as sort of a 'preserve segregation' platform. And then 1912, you have Teddy Roosevelt running as a Bull Moose third-party candidate. [He] was the most successful third-party candidate. Of course, he had already been president. So you've periodically had third-party challenges at a presidential level. At a House and Senate level, you have a few people who run as independents. But people tend to go right for the presidency because that creates a level of visibility if you're trying to build a party. If one thinks that the two-party system is a problem, let's talk about solutions. You advocate for something called proportional representation. Explain what that is and why you think it might be a solution here. Well, proportional representation is the most common system of voting, and it basically, at its simplest level, it means that parties get shares of seats in proportion to what percent of the vote they get. So if a party gets 30 percent of the vote, it gets 30 percent of the seats in the legislature. If it gets 10 percent, it gets 10 percent. Now, there are varieties of proportional representation that we could spend an hour going in the weeds. Tell me the one you like the best. What would work in the US? What I think would work in the US is probably the most commonly used version, which is called open list proportional representation with multi-member districts — which is this idea that rather than having a single district with a single representative, you have a single district with five representatives. The district is larger, and then the parties put forward lists of candidates. You choose the candidate from the party that you like, all the votes for each party get tallied up, and then the seats get allocated in proportion. So if a party gets 40 percent of the votes in that five member district, its top two candidates go to represent the district. If a party gets 20 percent, its top candidate [goes]. So, in theory, you could have five parties representing the same district. 'We've never had this level of dissatisfaction with the two-party system as far back as we've seen polling.' We talk a lot about gerrymandering as a huge problem, and it is. But [if] you move to five member proportional districts, gerrymandering becomes irrelevant. It doesn't matter because votes are going to be allocated proportionally no matter what. So, everybody gets to cast a meaningful vote because every seat matters. Every seat is competitive. Every vote matters. Electoral reform is the most powerful tool we have. So, at the end of the day, has Elon Musk done something admirable here [by] making this a topic of conversation in a kind of real way? Yeah. So, I think by raising the issue of the need for a third party, it certainly opens up a conversation about what it would take. I'm not sure Elon's approach is going to be successful. On the other hand, if he's strategic and wants to spoil a few races that will determine control of the House and the Senate by running a spoiler candidate, then, historically, that's actually what has led to a wider conversation about electoral reform. And that's one of the reasons that a lot of countries moved to electoral reform.
Yahoo
11-07-2025
- Politics
- Yahoo
Is Elon Musk's fight for a new third party 'an insurmountable thing'?
WASHINGTON ― Money wouldn't be a problem for Elon Musk in his quest to build a new national political party. But even for the world's richest man ‒ who has sent rocket ships to space and owns his own social media platform ‒ launching a viable third party in the United States is riddled with so many challenges that it makes the endeavor a long shot, according to political scientists, pollsters and other experts who have studied the topic. Fueled by his distaste of President Donald Trump's debt-exploding "Big Beautiful Bill," Musk on July 5 announced the formation of "the American Party" ‒ a movement he said will 'fight the Republican/Democrat Uniparty." He argued that "when it comes to bankrupting our country" both Democrats and Republicans are the same. More: Elon Musk announces new 'America' party after slamming Trump's megabill Proclaiming the existence of a political party doesn't make it one, however. Besides the technical hurdles to place congressional and presidential candidates on ballots in states, the 54-year-old Tesla and SpaceX CEO would need to overcome a long history of third-party failures in the United States and his own weak political standing. Only 36% of voters nationally had a favorable opinion of Musk in a June Reuters/Ipsos poll. "If the goal is to actually to win seats or even a few seats ‒ which seems to be what he's talking about right now ‒ it's probably an insurmountable thing," said Bernard Tamas, a political science professor at Valdosta State University and author of "The Demise and Rebirth of American Third Parties." More: 'Train wreck': Trump slams Musk after billionaire announces new political party Musk, a former top White House adviser who's turned into a fierce Trump foe, must first check off some logistical boxes to make the American Party a reality. That begins with filing the new party with the Federal Election Commission to raise or spend money, which he's not done. The FEC wouldn't be able to take immediate action to formalize the party because it lacks a quorum on the six-member panel after Trump has failed to nominate individuals for three vacancies. Musk has suggested he would focus on fielding American Party candidates in two or three 2026 Senate races and eight to 10 House races. But for them to gain ballot access in the states he targets, the party would need to meet required petition thresholds, which can number tens of thousands of signatures of registered voters depending on the state. Those efforts could face legal challenges if one of the two major parties views the third-party challengers as threats to peel off votes, election experts says. Meanwhile, building party infrastructure from scratch to match the well-financed Democratic and Republican machines would be no easy task ‒ although Musk's billions in personal wealth could certainly help on that end. Whether Musk has the political clout to fuel a third-party movement that takes off is perhaps the biggest question mark. Despite his vocal opposition over rising debt from Trump's megabill, Musk failed to convert any Republican members of Congress to his side to vote against the bill, which passed Congress with widespread Republican support. The three Republican senators and two GOP members who voted against the legislation weren't Musk's doing. Many Republican members of Congress told USA TODAY that they were turned off by Musk's scorched-earth attacks. Musk famously flopped when he inserted himself and millions of his dollars into Wisconsin's special election for a state Supreme Court seat in April. The Republican candidate lost by about 10 percentage points despite Musk declaring "the future of America and Western Civilization" at stake. More: President Trump says he'll 'have to take a look' at deporting Elon Musk as feud reignites Musk lacks a clear political following. And recruiting viable candidates might be a challenge. Already despised by many on the left, Musk has now turned off much of Trump's MAGA's base amid his public feud with Trump since departing the White House as head of the Department of Government Efficiency. "I'm skeptical that he has the following to do it. I'm also skeptical he has the strategy to do it either," Tamas said, adding that an even "bigger problem" is that Musk lacks a coherent message. "You have to tap into people's anger. It's not enough to say, 'We're not the Democrats or the Republicans. Let's all get along and talk.' This never goes anywhere." "It's good that he has the money," Tamas added, "but other than that, I'm not sure what he brings to the table." USA Today's efforts to reach Musk to respond to the skepticism on his third-party aspirations were unsuccessful. Polling has long suggested Americans support the concept of a strong third party in the United States. A Gallup poll conducted in October 2024 found 58% of Americans, including 69% of self-described independent voters, said Democrats and Republicans "do such a poor job" that a third party is needed. Although down from a record-high 63% of Americans in 2023, it marked the 12th straight year of a majority reading on that question. Similarly, USA TODAY/Suffolk University polls conducted over the past decade have found increasing support for third parties from Americans who say they don't typically vote in elections: 53% of these voters in 2012 said a third parry is necessary; 57% said the same in in 2018; and 64% in 2023. More: Elon Musk announces 'America Party': What to know about third parties in the U.S. Even so, third parties have failed to gain traction electorally, both in Congress and in presidential elections. When it comes to voting ‒ not responding to general questions in a poll ‒ entrenched loyalties to the two dominant parties have proven too strong. "The trend has been there for quite some time, but the implementation has not," David Paleologos, director of the Suffolk University Political Research Center, said of the disconnect between support for the concept of third parties versus election results. Sens. Bernie Sanders of Vermont and Angus King of Maine are both independents but caucus with Democrats. Other third parties in the United States, including the Libertarian Party and the Green Party, have not won any congressional seats. The last third-party presidential candidate to mount a serious threat for the White House was Ross Perot, who in 1992 won 19% of the popular votes but carried no states in the all-important Electoral College as an independent running on a "Reform Party" platform. More recently, consumer activist Ralph Nader finished with 2.7% of the popular vote in the 2000 election. Rather than putting states in play, Democrats remember him for the 97,488 votes he won in Florida, which they argue helped swing the election-deciding state from Al Gore to George W. Bush. Even the early 20th-century Progressive Party ‒ typically regarded as the most successful third-party in United States history ‒ was more impactful pushing Progressive-era reforms tackling business monopolies and improving worker rights than winning elections. After serving as the Republican president from 1901 to 1909, Theodore Roosevelt formed the Progressive Party, or "Bull Moose Party," in 1912 when he failed to win the Republican nomination for a third term. His candidacy syphoned Republican voters from the party's nominee, William Howard Taft, in the general election won by Democrat Woodrow Wilson. The former president's new political party dissolved in 1920. Trump over the weekend lashed out at Musk over his third-party plans, saying in a Truth Social post that his former sidekick has gone "completely off the rails" and noting third parties have "never succeeded in the United States." He later brushed off any political challenges the American Party could pose when asked by a reporter on July 8 whether he's concern about Musk's effort. "I think it will help us. It will probably help, Trump told reporters during a July 8 Cabinet meeting. "Third parties have always been good for me. I don't know about Republicans, but for me." Trump appeared to be referencing the 2024 independent presidential runs of liberal academic Cornel West and the Green Party's Jill Stein, who Trump allies worked to boost in battleground states to peel off votes from Democrats. Musk's party, however, would seemingly be better positioned to appeal to Republican voters than Democrats. More: 'It will help us': Trump says he's not worried about Elon Musk's new political party A former senior Trump campaign official told USA TODAY that Musk's third-party threat is not on the radar within Trump's orbit, downplaying the tech entrepreneur's push as the stuff of online chatter that isn't being discussed in the real world. Still, Musk's third-party pledge has irked some Musk adversaries in Trump world. Steve Bannon, Trump's former chief strategist, sounded off on Musk's announcement on his "War Room" podcast, calling Musk a "buffoon" and "Elmo the Mook." "Only a foreigner could do this ‒ think about it," Bannon said, referring to Musk being born in South Africa. "A non-American starting an America Party." Musk became a naturalized U.S. citizen in 2002 after previously gaining Canadian citizenship through his mother. Not long ago, Musk in 2018 described himself as "independent and politically moderate" before he started to embrace Trump and the MAGA movement during the 2024 campaign, pumping more than $290 million in the election to boost the Republican presidential nominee and Republican candidates for Congress. For all the skepticism on his third-party hopes, Musk might have one other thing going for him besides his deep pockets as he tries to pull of a third-party breakthrough: a thirst to disrupt. More: Elon Musk vows to defeat Republicans who vote for Donald Trump's mega bill Musk has upended traditional norms of the business world. He swiftly fired top executives and thousands of employees when he bought Twitter. He took a sledgehammer to the federal government during his four-month stint DOGE. He now seems willing to take down the same Republican Party he supported in the 2024 election. Paleologos called Musk a "disrupter at his core." "Musk thrives on being doubted," he said. "And this is the ultimate overcoming massive doubt that you can have." Reach Joey Garrison on X @joeygarrison. This article originally appeared on USA TODAY: Why Elon Musk's new national party is easier said than done
Yahoo
10-07-2025
- Politics
- Yahoo
Musk says exposing Epstein files will be America Party priority
Tech billionaire Elon Musk once again slammed President Trump over the Jeffrey Epstein case, confirming that his new political party, which he has dubbed the 'America Party,' will make it a priority to expose the files. Musk first questioned how people can be expected to have faith in the president if he doesn't release the files regarding the convicted sex offender and financier. 'How can people be expected to have faith in Trump if he won't release the Epstein files?' he asked in a post on X, the social platform he owns. A user commented on the post, asking if exposing the files would be a high-ranking priority for the 'American Party.' Musk responded in the affirmative with a '100' emoji. The White House criticized the allegations and the 'continued fixation on sowing division' within the Cabinet. 'President Trump is proud of Attorney General Bondi's efforts to execute his Make America Safe Again agenda, restore the integrity of the Department of Justice, and bring justice to victims of crime,' White House Press Secretary Karoline Leavitt said in a statement to The Hill. 'The continued fixation on sowing division in President Trump's Cabinet is baseless and unfounded in reality.' While Musk hasn't provided a formal outline of his policy platform for the new party, he's hinted at some future moves in social media posts since announcing its launch. It's the latest in the feud between Trump and Musk, who has continued to troll the president over the Epstein case. The Tesla CEO has alleged that Trump has ties to Epstein. 'Time to drop the really big bomb,' Musk wrote on X last month. '[Trump] is in the Epstein files. That is the real reason they have not been made public.' 'Mark this post for the future. The truth will come out,' he said in another post minutes later. On Monday, after the release of a memo from the Justice Department and FBI that found no evidence Epstein had a 'client list' and that no additional charges were expected, Musk posted an image showing 'The Official Jeffrey Epstein Pedophile Arrest Counter,' with the counter set to '0000.' 'What's the time? Oh look, it's no-one-has-been-arrested-o'clock again …' Musk wrote on X. He also knocked the Trump administration for initially promising to release the 'Epstein list' before reportedly saying, 'There is no Epstein list.' Trump has shut down allegations of his ties with Epstein, asking why people are still talking about 'this creep' during a Cabinet meeting on Tuesday. 'Are you still talking about Jeffrey Epstein? This guy's been talked about for years,' he said. Updated at 4:19 p.m. EDT. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
