Elon Musk’s Cardinal Mistake That Cost Him Billions: Did Trump ‘Play’ Him?

Prominent American marketing professor Scott Galloway stated that Elon Musk’s decision to carry out brutal layoffs and budget cuts in the federal government on behalf of the Trump administration is “one of the greatest brand destructions” ever recorded.

Speaking on Friday’s episode of the popular podcast Pivot, which he co-hosts, Galloway said that Musk — as an advisor to former President Donald Trump — alienated the customer base of his electric vehicle company Tesla, while aligning himself with a president whose voter base has little interest in EVs, The Guardian reports.

Galloway cited poll results showing that Tesla dropped from 8th to 95th place on the list of most reputable brands since 2021.

“He alienated the wrong people,” Galloway said. “Three-quarters of Republicans would never consider buying an electric vehicle. And he cozied up to exactly the people who don’t care about EVs.”

Sales Slump in Europe, BYD Overtakes Tesla

Galloway also presented data showing a significant drop in Tesla sales across Europe: 59% in France, 81% in Sweden, 74% in the Netherlands, 66% in Denmark, 50% in Switzerland, and 33% in Portugal.

In recent months, Musk has inserted himself into numerous political debates in Europe, including the German federal elections and controversies in the UK related to gangs recruiting minors — particularly via X, the social media platform he owns.

Following widespread backlash across Europe — a previously highly profitable EV market — Chinese competitor BYD has, for the first time, surpassed Tesla in European sales, according to a report from Jato Dynamics.

“This is probably one of the greatest brand destructions,” Galloway told his co-host, veteran tech journalist Kara Swisher. “Tesla was a great brand. Now he has alienated his core target audience.”

Musk’s Work in ‘Doge’ Department Led to Layoffs and Losses

The job cuts and budget reductions attributed to Musk stem from his role as director of the so-called Department of Government Efficiency (Doge) during Trump’s second term, which began in January. Musk was appointed to the role after his super PAC donated $200 million to Trump’s successful bid to return to the White House.

Public opinion polls show widespread dissatisfaction with Musk’s involvement in the Trump administration, especially regarding how he and the Doge department handled federal employees during mass layoffs.

Tesla Losing Profit, Musk Retreats from Politics

At the end of April, Tesla reported a profit drop of as much as 71%. During a meeting with investors, Musk announced that he would begin stepping back from Doge in May.

“I’ve completed most of the work on the government’s financial restructuring,” Musk said. “So my involvement in Doge will significantly decline.”

Cuts That Cost More Than They Save

The independent research organization Partnership for Public Service estimated that the approximately $160 billion in savings promoted by Doge will ultimately cost the U.S. government around $135 billion.