Source : THE AGE NEWS
Elon Musk defined the fine line between genius and insanity, between hope and delusion, when he test-drove his brand of cognitive dissonance on Wednesday, telling his investors that Tesla could be worth more than that of the world’s largest companies combined even as it posted stinker of a quarter.
That’s fighting talk from Musk given that Tesla’s profit for the quarter just dived 71 per cent, marking its worst quarterly profit since 2021. Just to keep things in perspective, Tesla is worth about $US750 billion, while the next five largest US companies boast a combined market value of roughly $US12 trillion.
Elon Musk has vowed to spend more time at Tesla after the company’s profit went into freefall on April 23, 2025.Credit: nnaseathompson
But perhaps the more confusing element of Musk’s behaviour is just how much time and effort he has invested in backing Donald Trump, whose tariff policies are blowing a hole in Tesla’s future. Musk’s contention that other US vehicle manufacturers have it worse, just misses the point.
“I just want to emphasise that this tariff decision is entirely up to the President of the United States,” he said. “I will weigh in with my advice with the president, but then it’s up to him.”
Trump’s policies, along with Musk’s messianic mission to remove “waste” and “fraud” from the US government, is really hurting Tesla’s shareholders and burning a hole in the tech billionaire’s pocket. So it’s no wonder that the big message on Wednesday from Musk was that DOGE may just have to take a back seat until Tesla’s numbers pick up.
The Musk-mobiles are now kryptonite to Tesla’s erstwhile legions of progressive fans.
It is difficult to define how much of Tesla’s 40 per cent share price fall this year can be attributed to the void left at the top of the company when Musk decided to embark on his own public service crusade and how much can be attributed to falling sales.
Musk’s promise to devote three to four days a week on his Tesla job from next month did give the EV maker’s share price a reprieve from the slump it has been in, but Tesla increasingly faces an uphill battle.
His association with Trump has damaged the Tesla brand, perhaps permanently, and directly led to lower car sales everywhere, including Australia.
Where once Tesla owners were seen as wealthy inner-city environmental warriors, today’s owners are subject to derision as de facto supporters of Trump.
The Musk-mobiles are now kryptonite to Tesla’s erstwhile legions of progressive fans and the company knows it.
Shifting political sentiments aside, there’s also a BYD-sized problem for Tesla, as competition from the Chinese EV manufacturer is intensifying at breakneck speed. BYD is just one of a burgeoning roster of Chinese companies that can outcompete Tesla on price and even technology.
So how does Musk marry Tesla’s current political, trade and competitive headwinds today with his claims that the company leapfrogs all larger companies on the globe?
A lot of it has to do with Tesla’s plan to launch its robotaxi service (starting in Texas) later this year and its development of humanoid robots. (Tesla has been promising self-driving vehicles for the past 10 years.)
Musk reckons the self-driving robotaxis will be the game-changer, freeing up drivers to do their hair and make-up, grab lunch or even have a nap as they zoom to towards their destination. And just for that added bit of bling, the cars can drive themselves out of the factory and deliver themselves to their new owner.
Elon Musk at the robotaxi event “We, Robot”.Credit: Tesla
But can they turbocharge Tesla earnings and propel it into a league of its own, a cut above the other car manufacturers of the world? The jury is well and truly out on that.
Whether the believers or the sceptics have made the right bet will become clearer once trials get started, and there is a band of technical exports that believe that Tesla is behind the curve on the software technology needed to ensure that its vehicles can avoid accidents and deal with all the driving contingencies in real-world conditions.
Tesla’s robotaxis would also have to contend other driverless technology such as Google’s self-driving automobile project, Waymo, which is considered to be more advanced, safer but currently too expensive to be commercial. And the threat of the Chinese automakers catching up is never out of the frame.
Undaunted by the naysayers, Musk was upbeat on Wednesday about the next step in Tesla’s future.
“In the not too distant future, buying a gasoline car that is not autonomous will be like riding a horse while using a flip phone. Some people still do it, but it’s rare.”
There was time, not that long ago, when those words from Musk would have been enough to put the doubters back in their box.
But after DOGE, his bromance with Trump and turning X (formerly known as Twitter) into a bin fire, Musk’s unfettered confidence may not be enough to get Tesla back on track.
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