The potential launch of a new political party by billionaire Elon Musk could result in him dedicating more time to politics, potentially putting his role at Tesla Inc. on the back burner. This development, combined with the passage of the “Big Beautiful Bill” by Congress and President Donald Trump, could have negative implications for Tesla and the electric vehicle sector.
What’s Happening with Tesla
The elimination of the $7,500 consumer tax credit and lack of demand for Tesla’s regulatory credits could hurt the company’s profitability. Additionally, Musk’s deeper involvement in politics could also negatively impact Tesla if he spends more time working on creating the party, naming candidates, and overseeing upcoming election efforts.
Reader Poll Results
A recent poll asked readers if they think Musk’s potential new party launch could hurt Tesla stock. The results were:
- Hurts – stock falls: 71%
- No real impact: 18%
- Helps – stock rises: 11%
Impact on Tesla Stock
While Musk may have benefited from his endorsement of Trump and his political involvement ahead of the 2024 election, readers don’t see the same happening with the launch of a third-party. Tesla stock reached an all-time high in December 2024, following Trump’s election victory, but eventually fell in early 2025 as Musk dedicated more time away from Tesla.
Why It Matters
The poll results showing a potential decline in Tesla’s stock price come as analyst Dan Ives argues that Tesla’s board of directors needs to “act now” and help establish rules for Musk to manage Tesla and his political ambitions. Ives recommends that the board:
- Develop a new incentive-driven pay package for Musk, increasing his ownership stake in Tesla to up to 25% voting power.
- Include requirements for the time commitment to Tesla operations as part of Musk’s pay package.
- Create a special Board oversight committee to monitor Musk’s political ambitions and ensure they don’t interfere with his role as CEO of Tesla.
Current State of Tesla Stock
Tesla stock is down 21.9% year-to-date in 2025, with shares currently trading at $296.42. Musk’s political push is not the only factor in Tesla’s stock decline, as other issues such as falling demand and the loss of EV tax credits are also likely contributing factors.
Study Details
The study was conducted from July 7, 2025, through July 8, 2025, and included the responses of a diverse population of adults 18 or older. The study reflects results from 55 adults.