Shares surged Wednesday following a Politico report suggesting Elon Musk may step down from his role at the so-called Department of Government Efficiency, allowing him to refocus on Tesla amid its ongoing struggles, as reported by CNBC.
The stock was up 4% after the news, rebounding from session lows where it had fallen as much as 6.4% due to weaker-than-expected first-quarter vehicle deliveries.
According to the report, which cites Trump administration insiders, President Donald Trump is satisfied with Musk’s efforts in driving DOGE spending cuts, but both have recently agreed that Musk will soon return to his businesses.
The news comes at a difficult time for Tesla. Despite Wednesday’s gains, the stock has dropped over 5% in the past month and more than 31% year to date. In the first quarter, shares tumbled 36%, marking Tesla’s steepest quarterly decline since 2022.
Musk’s involvement in the White House has been a source of pressure on Tesla’s stock, sparking protests, boycotts, and violent attacks on Tesla stores and vehicles worldwide. Additionally, Trump’s automotive tariffs, particularly those affecting Tesla’s suppliers in Mexico and China, have raised concerns among investors.
“My Tesla stock and everyone’s Tesla stock has basically been cut in half,” Musk said Sunday night at a Green Bay, Wisconsin, rally, where he promoted a right-wing judge ahead of Tuesday’s state supreme court election. “This is a very expensive job, is what I’m saying.”
New York City Comptroller Brad Lander has called for a lawsuit against Tesla on behalf of NYC pension funds, citing Musk’s White House role.
In a Tuesday statement, Lander’s office said: “The basis for potential litigation is Tesla’s misleading claims that CEO Elon Musk is deeply involved in the company’s management, despite his leadership of the Trump administration’s DOGE initiative, spending little time on Tesla, and advocating for policies that actively harm its business.”