[Business & Issues] Musk Returns After Leaving the White House: Will He Be Tesla's Savior?

Musk Resigns as Head of Government Efficiency Department
Investors Urge "Focus on Tesla"
Restoring Brand Image Remains Key

In March, Elon Musk, CEO of Tesla and head of the Department of Government Efficiency (DOGE), was seen entering the White House wearing a T-shirt with "DOGE" written on it. Photo by AFP News Agency

Tesla's stock price is rebounding following news that CEO Elon Musk has resigned from his position as head of the Department of Government Efficiency (DOGE). Amid a significant decline in performance due to boycott movements in the United States and Europe, Musk's return to Tesla is believed to have reignited investor sentiment. There is growing interest in whether Tesla will demonstrate new technological competitiveness in the robotaxi sector, where China is rapidly catching up.

Musk Leaves the White House... Tesla Stock Rebounds

On May 28 (local time), CEO Musk posted on his social media platform X, "My term as a special government official has ended. I thank the President for giving me the opportunity to help reduce government spending." He had served as head of the Department of Government Efficiency in a special government official capacity since January 20, when President Donald Trump took office. With the end of his special government official status, which can be maintained for up to 130 days per year, Musk has now completely left the White House.

Following this news, Tesla's stock price immediately rebounded. On May 29, Tesla shares closed at $358.43 per share, up 27.77% from $280.52 at the beginning of the month. Earlier this year, Tesla's stock price hovered above $420 after Musk joined the administration, but then plummeted to $221.86 on April 8 amid the impact of Tesla boycotts in the US and Europe. As speculation grew that Musk would not extend his term as head of the Department of Government Efficiency, the stock price recovered to the $300 range.

Musk reportedly parted ways with the Trump administration after strongly criticizing President Trump's tax cut legislation. In an interview with CBS on May 27, a day before announcing his resignation, Musk criticized the administration's tax policy, arguing that it would further increase the US fiscal deficit and undermine the achievements of the Department of Government Efficiency to date.

Ongoing Tesla Boycotts in the US and Europe... Investors Urge Musk to Refocus

A citizen protesting the boycott of Tesla on a street in Berlin, Germany, on April 30 (local time). Photo by Reuters Yonhap News

During Musk's period of political activity, Tesla's performance suffered significantly under the impact of boycott movements. Due to the Tesla boycott centered in Europe, as well as the US-China trade conflict and tariff wars, Tesla's vehicle sales dropped sharply. According to CNBC, Tesla's global electric vehicle sales in the first quarter of this year totaled 337,000 units, a 13% decrease compared to the same period last year.

In particular, sales in Europe have struggled to recover. According to the European Automobile Manufacturers Association (ACEA), Tesla sold only 61,320 electric vehicles in Europe from January to April this year, a 39% decrease compared to the same period last year. The boycott in Europe has persisted since Musk publicly expressed support for the far-right Alternative for Germany (AfD) party in January.

During Musk's political engagement, the sale of shares by Tesla board members also drew criticism from investors. Robyn Denholm, chair of Tesla's board, sold $180 million (approximately 247.5 billion KRW) worth of Tesla stock from the beginning of the year through May 29. Another board member, Musk's brother Kimbal Musk, reportedly sold $32 million (about 4.4 billion KRW) worth of his shares recently.

Amid these controversies, some Tesla investors have demanded that Musk focus more on his duties at Tesla. On May 29, some shareholders sent a letter to Tesla's board, stating, "Stock price volatility, declining sales, and a sharply deteriorating global reputation are serious concerns," and urging the board to require Musk to work at least 40 hours per week at Tesla.

China Rapidly Closing In on Tesla's Robotaxi Business... Intensifying Technological Competition

On March 11, a passenger was getting off Pony AI's robotaxi in Guangzhou, China. Pony AI, a Chinese autonomous driving service company, operates four robotaxi pilot routes in Guangzhou. Photo by Xinhua News Agency

With Musk's return, Tesla's robotaxi business?a self-driving vehicle taxi service that the company has been preparing as a core business?is also expected to gain momentum. As the autonomous vehicle market is projected to expand, competition with Chinese companies is expected to intensify further.

According to Bloomberg, Tesla plans to launch its robotaxi service in Austin, Texas, on June 12. On May 28, Tesla reported that it had conducted test drives of autonomous vehicles on public roads in downtown Austin. Earlier this month, Musk announced that about 10 robotaxis would begin pilot operations in Austin, with plans to expand to 1,000 vehicles within a few months.

Currently, Tesla's main competitors in the robotaxi sector are China's Pony AI and Baidu, as well as Waymo, a subsidiary of Google. Pony AI, in particular, already operates 100 robotaxis in Beijing, Shanghai, Guangzhou, and Shenzhen, and has reached an agreement with the Roads and Transport Authority (RTA) of Dubai to operate robotaxis in the United Arab Emirates as well.

Tesla's robotaxi is considered to be technologically ahead of its competitors, but its pilot operations have been relatively slow to start. According to CNBC, Tesla claims that, unlike its rivals, its robotaxi can use artificial intelligence (AI) technology to allow the vehicle to recognize and adapt to roads in real time without the need for detailed maps. In contrast, robotaxis from Waymo, Pony AI, and Baidu still rely on preloaded maps, making it difficult for them to operate in areas where high-precision maps have not yet been established.