Tech billionaire and Tesla CEO Elon Musk has stirred fresh controversy with the announcement of a bold new political venture, the “America Party,” sparking concerns among financial analysts and shareholders already uneasy with his deepening political involvement.
Over the weekend, Musk took to social media to outline his vision for the party, stating that it would focus on flipping “just 2 or 3 Senate seats and 8 to 10 House districts.” He argued that such a strategic approach could give the party decisive influence in Congress, allowing it to “serve as the deciding vote on contentious laws” and align legislation with what he described as “the true will of the people.”
But the timing of Musk’s political pivot is raising red flags across Wall Street. Tesla is currently battling a 14% year-over-year plunge in vehicle deliveries for the second quarter of 2025, falling short of market expectations and intensifying pressure from both legacy automakers and aggressive EV startups, particularly in China, Tesla’s most vital growth market.
CNBC reports that the company’s declining performance, coupled with growing global competition, has made this a critical period for Tesla. Investors fear that Musk’s escalating political ambitions could become a dangerous distraction from the company’s operational challenges.
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Dan Ives, global head of tech research at Wedbush Securities, warned in a note on Sunday that Musk’s political move is deeply unsettling for shareholders. “Very simply, Musk diving deeper into politics and now trying to take on the Beltway establishment is exactly the opposite direction that Tesla investors/shareholders want him to take during this crucial period for the Tesla story,” Ives wrote.
Despite Musk’s immense influence and loyal fanbase, many Tesla investors appear to be running out of patience. “While the core Musk supporters will back Musk at every turn no matter what, there is a broader sense of exhaustion from many Tesla investors that Musk keeps heading down the political track,” Ives added.
This isn’t Musk’s first political detour. Earlier in the year, he joined the Department of Government Efficiency (DOGE) under former President Donald Trump, a move that sparked backlash from environmentally conscious consumers and raised concerns about Tesla’s brand integrity. Musk’s departure from DOGE in May was seen as a positive turn for the company’s stock, but his latest political announcement has reignited investor anxiety.
Adding to the drama, Musk’s once-strong alliance with Trump appears to have fractured. Trump, who initially praised Musk, lashed out at his new political plans on Sunday, calling the America Party “ridiculous” and accusing Musk of going “completely off the rails.”
As Tesla grapples with falling sales and mounting competition, industry experts warn that now is not the time for Musk to shift his focus to Capitol Hill. Many believe the future of Tesla and its investors’ confidence, depends on Musk doubling down on innovation and execution, not politics.
