Tesla Sees Stock Spike Amidst Musk’s D.O.G.E Exit Plans
Elon Musk announced Tuesday that he plans to scale back his role in Washington beginning in May, just as Tesla works to rebound from a tough financial quarter.
During the company’s earnings call, Musk said his involvement with President Donald Trump’s Department of Government Efficiency (D.O.G.E) would be “significantly reduced” next month.
The announcement sent Tesla shares up nearly 5% in after-hours trading.
BREAKING: Elon Musk announces he’ll be stepping back from DOGE starting in May.
“Next month I will start allocating more time to Tesla.”$TSLA shares have surged over 5% in after hour trading on this news.
— Jacob King (@JacobKinge) April 22, 2025
Musk assured investors he would still support D.O.G.E’s mission to root out government waste, though on a limited basis—roughly “a day or two per week”—as long as the president requests his input.
His remarks came shortly after Tesla reported a steep 20% drop in automotive revenue and a 71% plunge in net income for Q1, raising questions about whether his partial return to Tesla leadership could help steer the company back on course.
Musk’s Political Influence Erodes After Major $300 Million Trump Investment
Musk launched D.O.G.E after contributing nearly $300 million to Trump’s 2024 campaign—a move that helped propel Trump back into the White House and earned Musk the informal title of “First Buddy.”
A $8m loan on essentially commercial terms? Skeptical. Musk gave $300m. Trump shivved him. Musk hoped to ship from Europe & China to the US. Trump set big tariffs and wants to end EV rebates. Musk should have learned from the Adelsons, Trump's friends since Atlantic City days. https://t.co/OVWyZeROoT pic.twitter.com/SuVaoewYoI
— jon kessler (@jonkessler20) April 22, 2025
Since its creation, D.O.G.E has aggressively targeted a wide range of federal agencies, including the IRS, National Park Service, Consumer Financial Protection Bureau, and departments such as Agriculture, Education, Energy, Health and Human Services, Homeland Security, and Veterans Affairs.
Notably, D.O.G.E also cut into agencies tasked with overseeing Musk’s own businesses—the Securities and Exchange Commission (SEC), Federal Aviation Administration (FAA), and National Highway Traffic Safety Administration (NHTSA)—all of which experienced significant staffing reductions during Musk’s government tenure.
In February, the White House designated Musk as a “special government employee,” a legal classification that reduces conflict-of-interest disclosure requirements and applies to individuals serving fewer than 130 days in a calendar year.
That time limit is set to expire at the end of May unless Musk is reappointed under a different designation.
While D.O.G.E claims to have saved the federal government $160 billion, scepticism persists.
Some of its more extreme savings figures have already been scrubbed from its website following public scrutiny.
Meanwhile, Tesla’s market capitalisation has plummeted by an estimated $600 billion during the same period, raising pointed questions about whether Musk’s time in Washington has come at too high a cost.
Tesla's Reputation Still Under Fire with Ongoing Backlash
Musk also weighed in on the wave of protests that have erupted at Tesla sites across Europe and the United States.
During the company’s earnings call, Musk attributed the demonstrations to “very organised” groups, suggesting—without offering evidence—that some protestors were motivated by “fraudulent money” or were “recipients of wasteful largesse.”
He did not elaborate on these claims.
The protests reflect broader backlash against Musk’s political affiliations, particularly his vocal support for Germany’s far-right Alternative für Deutschland (AfD) party, which has eroded Tesla’s brand trust abroad.
At the same time, the company is grappling with an aging EV lineup and intensifying competition from Chinese manufacturers.
Tesla just reported its weakest quarterly results since 2022, with its stock down 41% in 2025.
A devastating Tesla earnings report today…
Net income fell 71%.
Total revenue slid 9% from $21.3 billion a year earlier.
Tesla stock down 41% so far in 2025, suffered their worst quarterly drop since 2022. pic.twitter.com/D0fj4nJkgn
— The Lincoln Project (@ProjectLincoln) April 22, 2025
A temporary boost came after President Trump confirmed he would retain Federal Reserve Chair Jerome Powell, easing investor nerves.
Meanwhile, Musk’s role in government via D.O.G.E continues to stir controversy.
Reports from February detail how D.O.G.E operatives allegedly entered the Department of Education, physically removed senior officials, rearranged offices, and installed white noise machines—moves that alarmed Capitol Hill lawmakers.
Senators have since raised concerns that D.O.G.E may have accessed sensitive federal student loan data tied to millions of Americans.
As Musk prepares to scale back his role in Washington, scrutiny over his influence inside federal agencies is only intensifying.
Whether D.O.G.E’s deep cuts will last is uncertain—but one thing appears increasingly clear to Wall Street: Tesla may fare better with Musk focused on cars, not cabinet chaos.
