Why Elon Musk should sell Tesla before it's too late | Opinion

Tesla has been in the headlines for the wrong reasons lately.

The brand’s controversial figurehead, Elon Musk, is losing his ‘tech saviour’ public image as he wades deeper and deeper into politics. But his controversial political stance is creating a growing negative sentiment around the electric car company, so has the time come for Musk to sell Tesla?

I’d argue the time is perfect for Musk to finally cash-out of Tesla and focus on what has clearly become his primary focus — politics and Mars.

This week the White House confirmed Musk has been given the title of “special government employee” as he helps newly-installed US President Donald Trump attempt to slash billions out of the government’s budget and cut government jobs. At the same time, Musk’s new close connection to the US government has spurred talk of his long-discussed goal of sending a manned-mission to Mars (ironically, a program that will likely cost trillions of dollars).

Musk has a reputation as a workaholic and someone capable of taking on multiple major projects at the same time, such as running Tesla and SpaceX, but is his new government role a step too far even for him?

The longer he stays in politics, the deeper he gets into that space, the greater the risk he runs of alienating the core customer base of Tesla buyers. While Musk has aligned himself with a government that is actively working against climate change, something many Tesla owners are trying to help by buying an electric car.

There were likely many factors behind Tesla’s global sales decline in 2024, but the cold, hard reality is, its sales did decline for the first time in its history. One year is just a blip, if it happens again in 2025 it becomes a concern and if sales decline again in ‘26 then it becomes a trend.

Musk needs to act while Tesla’s value is at a high and before things get worse and Tesla becomes ‘public enemy #1’ for environmentally minded new car buyers. 

Putting aside the politics for a moment, now is also an ideal time to sell because there is still a lot of solid technology and marketing impact for Tesla at the moment that a new owner could benefit from. However, the longer Musk is distracted by politics and not expanding the model range, the less and less appealing the brand becomes.

The Cybertruck has failed to have the significant sales impact that was initially expected, the Model S and Model X are only available in limited markets and are getting long in the tooth and the Model 3 and Model Y are also starting to show signs of age. The long-rumoured more-affordable Model 2 has never appeared and the Robotaxi announcement from 2024 raised more questions than it answered — such as ‘why would you make a two-door taxi?’ and ‘will Tesla actually build it?’

At the time of publication Tesla has a market capitalisation of a staggering US$1.18 trillion. To put that in context, Toyota (a highly profitable, popular and proven car maker) has a market cap of US$300 billion, BYD (China’s rapidly growing EV and hybrid brand) is valued at US$100 billion, while General Motors has a market cap of ‘only’ US$47 billion.

Or to put that all in simple terms — Tesla is massively over-valued and that’s always a good time to sell any product. Of course, there’s also the minor matter that anything is only as valuable as someone is willing to pay for it, and it’s unlikely anyone will pay US$1.18 trillion for a car company with an aging product line-up and coming off the back of a decline in sales.

Tesla does still have a lot going for it, with factories in the USA, China and Germany, making for an appealing production footprint for any global brand. But, by far, the most appealing element is it’s the market-leader when it comes to EV and battery technology, so that’s what any potential buyer would be most interested in.

Who would/could buy Tesla? That's an incredibly difficult question to answer, but the most obvious candidate would be a brand struggling with electric vehicles — and deep pockets. Perhaps Volkswagen could benefit from some Tesla tech, or Stellantis could add another brand to its massive portfolio. Certainly a car maker with multiple brands, that could use Tesla’s platforms to underpin a range of models with different badges.

Of course, this is all a hypothetical and it’s incredibly unlikely Musk would relinquish the brand he has helped turn into a household name. Even if it becomes a lower priority to him over the coming years as he focuses on his political work and long-held ambition of reaching Mars.