Tesla Brand Loyalty Drops to Middling Levels Amid CEO Musk's Political Controversy

Tesla's brand loyalty dropped significantly from 73% in June 2024 to 49.9% in March 2024, according to S&P Global Mobility data. The decline was attributed to Elon Musk's public commitment to a political campaign that aimed to destroy the EV industry. Tesla's loyalty has since recovered to 57.4% in May, still lower than its previous peak.

Tesla's brand loyalty has seen a significant decline, dropping from 73% in June 2024 to 49.9% in March 2024, according to S&P Global Mobility data [1]. This marked a sharp fall from the industry's highest customer loyalty rate. The decline was attributed to Elon Musk's public commitment to a political campaign that aimed to destroy the EV industry, which turned off many eco-conscious customers.

Tesla's customer loyalty rate has since recovered to 57.4% in May 2025, still lower than its previous peak. This recovery came after Musk's increased political activism, which began in July 2024 following an assassination attempt on the Republican nominee, Donald Trump. Musk's endorsement of Trump, along with his subsequent budget-slashing policies and layoffs of government workers, contributed to the drop in customer loyalty.

The decline in brand loyalty coincides with Tesla's aging model lineup and increased competition from traditional automakers like General Motors, Hyundai, and BMW, as well as newer EV startups such as Rivian and Polestar. The only new model Tesla has released since 2020, the triangular Cybertruck, has failed to meet Musk's expectations of hundreds of thousands of annual sales.

Tesla's overall vehicle sales have been declining globally, with an 8% drop in the United States in the first five months of 2025 and a 33% decline in Europe over the first six months of the year. These declines are partly attributed to Musk's increased political activism and the heightened competition from Chinese EV makers and other traditional automakers.

S&P analyst Tom Libby described the decline in Tesla's brand loyalty as "unprecedented," noting that he had never seen such a rapid drop in such a short period. Analysts suggest that Tesla's long-term success depends on its ability to repair the brand damage and regain the trust of its eco-conscious customer base.

References:
[1] https://www.reuters.com/business/autos-transportation/teslas-brand-loyalty-collapsed-after-musk-backed-trump-data-shows-2025-08-04/
[2] https://www.business-standard.com/companies/news/tesla-s-brand-loyalty-collapsed-after-musk-backed-trump-shows-data-125080401604_1.html