Musk’s persona deters would-be Tesla buyers

TESLA is facing reputational damage that is seeing its ‘consideration score’ tumble, says a report published by Reuters this week.

 

Citing the “polarising persona” of chief executive officer Elon Musk as the primary reason for Tesla’s fall from grace, the article capitalises on data sourced from US Market intelligence firm Caliber, showing a February 2024 consideration score of just 31 per cent – less than half of its November 2021 high of 70 per cent.

 

The February score marks an eight per cent fall from the month prior, indicating what Caliber refers to as strong associations between Tesla’s reputation and that of Mr Musk.

 

“It is very likely that Musk himself is contributing to the reputational downfall (of Tesla),” said Caliber chief executive officer Shahar Silbershatz, whose survey showed that 83 per cent of Americans connect Musk with Tesla.

 

Reuters spoke to several marketing, polling, and automotive industry experts who said controversies surrounding Mr Musk’s increasingly right-wing political stance and public statements are weighing on Tesla’s brand and demand.

 

“It is hard enough to win sales without getting into politics,” said Northwestern University marketing professor Tim Calkins.

 

The report suggests that economic fears, a lack of affordable new models, recent reports of toxic waste dumping, and rising competition from cheaper rivals are also placing pressure on Tesla.

 

Cox Automotive suggests overall EV sales in the United States are forecast to increase by 15 per cent in the first quarter of 2024, while Tesla sales will increase by just three per cent.

 

“The EV slowdown is shaping up to be a Tesla slowdown,” Cox Automotive analyst Stephanie Valdez Streaty told Reuters.

 

The article suggests that Mr Musk’s “outsized personality”, his recent endorsement of anti-Semitic comments on X (formerly Twitter), and his growing support of the US Republican party are contributing to Tesla’s reputational damage.

 

Brand valuation consultancy Brand Finance found Tesla’s reputation fell steadily across 2023 in the other markets, too, including Australia, France, the Netherlands, and the United Kingdom.

 

Tesla’s reputation did not suffer in China, where access to news on the company and its CEO may have been limited.

 

Further, Reuters reports that consumer analytics data supplied by CivicScience showed that 42 per cent of respondents had an unfavourable view of Elon Musk, up from 34 per cent in April 2022 when he disclosed his stake in Twitter.

 

Countering the sentiment measured in the United States, Tesla continues as one of the most popular choices in the Australian market – EV or otherwise. Sales of the Model 3 and Model Y are not only towering over other electric models but leading their respective classes.

 

In the Medium passenger over $60K segment, February sales of the Tesla Model 3 hit 3593 units, taking the year-to-date (YTD) tally for the model to 4316. That figure eclipses the second-place BMW 3 Series which managed just 186 unit sales in February and 394 YTD unit sales.

 

Similarly, the Tesla Model Y is seemingly unstoppable in its dominance of the Medium SUV over $60K segment. For the month of February, the electric SUV accrued 2072 unit sales, driving a YTD total of 2456 unit sales.

 

Again, the numbers dwarf those of the category’s second-place entrant, the Lexus NX totalling 533 unit sales in February for a YTD total of 932.