Tesla's backlash over Musk's politics and his $1 trillion pay package

Investors also weighed Musk's politics. Some called for changes after he agreed with an antisemitic post in November 2023,^[13] and in July 2024 he said a Trump presidency would be devastating to Tesla's competitors.^[14] Tesla's sales fell in 2024 for the first time in at least nine years.^[15] After Trump won, its stock surged, pushing its value past $1 trillion,^[1][16] helped by a report that Trump planned rules to speed up self-driving cars,^[17] and investors bet that Musk would profit from the new administration.^[18]

The backlash peaked in early 2025, as Musk led the Trump administration's cost-cutting effort. Tesla's European sales fell 49% in the first two months of the year.^[19] After one of the worst single-day sell-offs in Tesla's history, Trump said at the White House that he would buy a Tesla and called the boycott illegal.^[20][21] He said he would label violence against Tesla domestic terrorism, Attorney General Pam Bondi promised charges, and Trump suggested that attackers serve 20 years in El Salvador's CECOT prison.^[22][23][24] Musk urged employees to hold on to their stock, which had fallen 34% that year.^[25] First-quarter deliveries fell 13%,^[26][2] profits fell 71%,^[3] sales in Europe kept falling,^[27] and second-quarter sales fell more than 13%.^[28]

Musk's break with Trump hit the stock again. Tesla shares fell 14% during their public feud in June 2025, and Trump considered selling the Tesla he had bought.^[29][30] They fell nearly 7% after Musk announced a new political party in July.^[31] The board awarded Musk shares worth about $29 billion in August,^[32] and in September it proposed a pay package that could make him the first trillionaire; Musk bought $1 billion of Tesla stock days later.^[33][34] Musk called proxy advisory firms that opposed the package "corporate terrorists,"^[35] Tesla's chair warned shareholders that they could lose him,^[36] and Norway's sovereign wealth fund voted against it,^[37] but 75% of shareholders approved it in November.^[5] In December, Delaware's Supreme Court restored his 2018 package.^[6]

Sales recovered as the backlash faded. They hit a record in the third quarter of 2025 as buyers rushed ahead of the end of a $7,500 federal tax credit,^[38] though China's BYD passed Tesla as the world's biggest electric vehicle maker for the year.^[39] Tesla's sales rose again in the second quarter of 2026,^[4][40] and third-quarter deliveries of 486,532 beat estimates.^[41] An analysis found that Musk was paid 2.5 million times more than Tesla's median worker in 2025.^[42] After Democrats swept the 2026 midterms, Tesla and SpaceX lost a combined $456 billion in market value in two trading days, according to Tech Startups.^[43] Musk's role in the Trump administration and his ownership of X are followed in separate arcs.