Elon Musk decided to step back from his role as the leader of the U.S. Department of Government Efficiency (DOGE) starting in May 2025.

This decision follows a challenging first quarter for Tesla, marked by a substantial decline in profits and revenues.

According to insiders, Musk's also seems to think that he has nearly completed all he needed to at DOGE. It was revealed in an investor call, Musk said the work needed to get the government's financial house back in order is almost done.

Musk's tenure is also coming to an end, as his 130 day appointment would end in late May. Trump also once addressed this, expressing that he would love to keep Musk, but he (Musk) has his own company to run.

Tesla's sluggish performance in the first quarter

While Musk is trying to portray his departure as a positive note, but many are not buying his bluff, stating that Musk's departure from DOGE was a result of the backlash that his appointment has on his private business.

Following Musk's alliance with Trump, first at Trump's campaign and later appointment as the leader of DOGE, it has caused Musk to lose a great deal of supporters and consumers who does not share Musk's support for Trump.

Tesla has reported a 71% drop in net income to $409 million and a 9% decline in revenue to $19.3 billion for the first quarter of 2025, falling short of Wall Street expectations.

Vehicle deliveries also decreased by 13%, totaling 336,681 units. Analysts attribute these declines to a combination of macroeconomic factors and a branding crisis linked to Musk's political role.

Musk's dual role as Tesla CEO and head of DOGE has faced criticism, particularly from investors urging him to step down from his government advisory position and concentrate on addressing company performance issues.

His political involvement has been linked to a branding crisis for Tesla, with the company's stock halving in value and incidents of vandalism against Tesla vehicles rising.

Musk admits Tesla is facing rocky moments, but remains optimistic

In the midst of all these backlashs, Musk claims that the drop in Tesla's shares and sales is more of a rocky moment for the company rather than a result of his appointment at DOGE.

Musk claims that the drop in demand is due to macro economic trends, and not a result of its branding. Musk cites that during these tough economic times, it is not unusual that consumers would pull back on their decision to buy cars, hence the sluggish demand.

Despite its "rock moments", Musk has also voiced optimism for the future of Tesla, claiming the future for Tesla is better than ever.

"The value of the company is delivering sustainable abundance with our affordable AI-powered robots. If you say what's the ideal future that you can imagine, that's what you'd want."

Analysts attribute the company's overall difficulties to a number of factors, but have ultimately concluded Musk's role in the White House to be the greatest cause for the branding crisis for Tesla.

Analysts claim that Musk is now at a crossroad, and he has to decide either to save DOGE or his own company, Tesla. The biggest remedy Tesla could have is if Musk leaves his role at DOGE and returns to Tesla full time as its CEO.