Tesla Shares Rise as Musk Exit Rumors Boost Investor Hopes

Tesla shares jumped Wednesday as rumors spread that Elon Musk could soon leave his post at the Department of Government Efficiency. The potential move could shift Muskโ€™s full attention back to Tesla.

The report, published by Politico, cited Trump insiders who said Musk and the president had agreed he would return to business soon. The White House later denied the claim, calling it โ€œgarbage.โ€

Tesla Stock Turns Green Despite Rough Start

Teslaโ€™s stock flipped higher after the report surfaced. It gained nearly 5% during the day. Just hours earlier, shares had plunged more than 6% due to weak first-quarter vehicle deliveries.

Despite Wednesdayโ€™s rebound, Tesla stock is still down over 5% this past month. Since the start of 2025, the drop is steeperโ€”more than 31%. The first quarter alone saw a 36% plunge, Teslaโ€™s worst since 2022.

Investors have blamed multiple factors, including Muskโ€™s political distractions, weakening EV demand, and tariffs impacting supply chains.

Muskโ€™s White House Role Creates Backlash

Muskโ€™s government position has caused chaos for Teslaโ€™s brand. His alignment with Trump sparked global protests, boycotts, and even vandalism at Tesla stores. Critics say his political involvement hurt Teslaโ€™s image and stock value.

Speaking at a rally in Green Bay, Wisconsin, on Sunday, Musk acknowledged the toll. โ€œMy Tesla stock and the stock of everyone who holds Tesla has gone, went roughly in half,โ€ he said. โ€œThis is a very expensive job is what Iโ€™m saying.โ€

Musk Invested Big in Wisconsin Election

Musk wasnโ€™t just talking politics. He poured millions into a state Supreme Court race, backing conservative judge Brad Schimel. The result didnโ€™t go his way.

Democrat-backed Judge Susan Crawford won by a wide margin. Progressive groups openly attacked Muskโ€™s influence, his DOGE cuts, and the impact of his involvement in the White House. On social media, Musk posted frequently about the race, turning it into a personal campaign.

Muskโ€™s time away from Tesla may soon lead to legal trouble. New York City Comptroller Brad Lander wants to sue the company on behalf of NYC pension funds.

Landerโ€™s office released a statement Tuesday. It accused Tesla of making โ€œmaterial misstatementsโ€ about Muskโ€™s involvement in company operations. They claim Musk hasnโ€™t been fully engaged at Tesla while running a controversial federal initiative under Trump.

The statement added, โ€œMuskโ€™s policies are actively harmful to Teslaโ€™s business.โ€

Tesla Shares Rise, But Trouble Isnโ€™t Over

The rally on Wednesday brought a sigh of relief to Tesla investors. Still, many remain uneasy. Muskโ€™s political entanglements and Teslaโ€™s declining delivery numbers continue to weigh heavily on the stock.

Whether Musk truly leaves the White House remains uncertain. Trump has praised Muskโ€™s work in the DOGE program and may try to keep him around in some capacity.

For now, markets responded positively to the idea of Musk returning to Tesla full-time. But unless deliveries improve and political distractions fade, Teslaโ€™s long-term recovery may remain stalled.

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