Shares of Tesla Inc
At last check, shares were down over 3.2% in after-hours trading.
What Happened: Politico reported that Trump told his cabinet that Musk could leave his administration soon. While Trump has publicly praised Musk's actions leading the Department of Government Efficiency, political operatives and journalists believe Musk may be a liability to the administration.
For example, Musk reportedly invested over $20 million to defeat Democrat Susan Crawford in Tuesday's Wisconsin Supreme Court election.
Crawford won.
Musk's exit could also be due to his status as a special government employee, meaning he can only work 130 days each year. His position with the administration began in January.
The report was published midday on Wednesday; soon afterward, shares of Tesla rallied as investors-many of whom had wanted Musk to focus on the company he's led since 2008 rather than politics-poured money into the carmaker.
Shares spiked over 6% in the hour following the report's publication.
Musk, meanwhile, dismissed reports that he was leaving DOGE due to discord with other administration officials as "fake news."
This "scoop" is garbage. Elon Musk and President Trump have both *publicly* stated that Elon will depart from public service as a special government employee when his incredible work at DOGE is complete.
Why It Matters: Tesla's stock was the second-highest performing in the S&P 500 between Trump's election on Nov. 5, 2024, and his inauguration on Jan. 20, according to Benzinga Pro.
Investors' honeymoon was shortened when the company's shares fell as much as 50% since Trump began his second term. Between Jan. 21 and March 21, Tesla was the second-worst-performing stock in the index.
The company experienced a decline in sales in recent months, perhaps due to Musk's actions on inauguration day and his polarizing political stature.
In particular, Tesla was hit particularly hard in European markets after Musk endorsed far-right parties in Germany and the United Kingdom.
It is unusual for executives to take on positions in presidential administrations while also leading their respective companies.
