Yale Economists Measure the Exact Impact of Musk’s Political Stance on Tesla Sales | Carscoops
Tesla's US sales could have potentially increased by as much as 83% between 2022 and 2025 without the negative impact of its CEO, according to a new report.
Yale economists state that Elon Musk's political actions have considerably harmed Tesla's sales. The analysis attributes the notable decline in sales to what is described as the “Musk partisan effect.”
Tesla shareholders will be voting in November regarding Musk's $1 trillion compensation package.
Once viewed as an innovative genius with widespread support, Tesla CEO Elon Musk has garnered significant criticism in recent years due to his controversial political views and associations.
Additionally, a recent study has validated what many had long suspected: that these political stances have resulted in billions of dollars in lost sales revenue for Tesla.
How Severe Is the Impact?
According to The National Bureau of Economic Research, a group of economists from Yale University, Tesla's sales in the US plummeted by between 1 million and 1.26 million vehicles from October 2022 to April 2025.
The authors project that Tesla's sales during this timeframe could have been 67-83% higher. Many of the potential buyers driven away turned to competitor car manufacturers, whose sales of electric and hybrid vehicles reportedly increased by around 17-22% as a result, according to the study.
Some of Musk's actions that alienated Tesla's typically Democrat-voting customer base included a $300 million donation to Republican candidates ahead of the 2024 presidential election, marking a clear political realignment that disturbed parts of his core audience.
Further controversy arose when Musk took a role with Donald Trump's newly established Department of Government Efficiency (DOGE) and expressed support for far-right political parties in other countries, such as Germany’s AfD.
These decisions altered his public perception and widened the gap between his business interests and their once-devoted supporters.
The study indicates that Musk's actions and their repercussions on sales have negatively influenced California's efforts toward achieving net-zero emissions, hindering the state's plans to meet its 2026 targets.
A Slight Recovery?
Nonetheless, the researchers point out that public perception of the Tesla CEO has improved since Musk shifted his focus from Donald Trump back to technological advancements, such as robotaxis, self-driving vehicles, and Tesla's emerging robotics sector.
Tesla's global sales are still expected to decline by about 10% this year, but Musk's ambitions remain unshaken. He is currently advocating for a $1 trillion compensation package, which shareholders will vote on next month.
If the proposal is accepted, it would constitute the largest compensation package ever awarded to a corporate executive. Tesla Chairman Robyn Denholm has informed shareholders that Musk may consider leaving if the financial package does not materialize.
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Yale Economists Measure the Exact Impact of Musk’s Political Stance on Tesla Sales | Carscoops
Tesla's sales in the US might have increased by as much as 83% from 2022 to 2025 had it not been for the negative impact of its CEO.