Elon Musk is facing mounting setbacks across his business and political ventures as shifting U.S. policies, declining investor confidence, and global backlash converge to put pressure on his multi-billion-dollar empire. Once seen as a symbol of innovation, Musk is now grappling with diminished influence and deteriorating performance in key markets. Over the past several weeks, Musk’s net worth has dropped by more than $100 billion, largely driven by a sharp decline in Tesla’s stock, which has fallen 17% since the announcement of new reciprocal tariffs by U.S. President Donald Trump.
Tesla also reported a 13% decline in first-quarter sales, its steepest ever, while rivals such as BYD posted substantial growth. A report citing senior political figures suggested the Trump administration may be preparing to phase out Musk’s advisory role, which the White House later denied. Musk dismissed the report as false, but confirmation of the end of his temporary government position by mid-year helped stabilize Tesla’s share price. The strain on Tesla goes beyond stock performance. The company’s brand has taken a hit, especially in China, where consumers are turning to domestic electric vehicle makers.
Analysts point to Musk’s political affiliations and his perceived role in controversial U.S. policies as contributing factors. Tesla, which imports around 25% of its parts from abroad, is particularly vulnerable under the new tariffs, as key materials and components are sourced from tariff-affected countries including China. Other major companies in Musk’s portfolio are also facing repercussions. SpaceX, now the largest contributor to his wealth, is dealing with cost increases and uncertain international contracts. Its satellite internet arm, Starlink, relies heavily on Asian suppliers who are now subject to steep tariffs.
Some international partners have already begun distancing themselves; in Canada, a $68 million contract was recently cancelled in direct response to escalating trade tensions. Meanwhile, Musk’s artificial intelligence venture xAI, which recently merged with his social media company X, is also expected to be hit hard. The company’s plans to build additional data infrastructure in the United States are now threatened by rising costs of imported components and raw materials. Analysts note that essential equipment for large-scale data centers, often sourced from China, Taiwan, and Vietnam, will become significantly more expensive under the tariff regime.
Despite his growing opposition to the trade policies, including public endorsements of free trade and direct appeals to President Trump, Musk has thus far failed to sway the administration. His comments criticizing key policy figures and advocating for a tariff-free agreement with Europe have not led to any visible change in strategy. As pressures mount from investors, consumers, and global partners, Musk’s influence appears increasingly fragile. Though he remains the wealthiest person in the world, the current environment is testing the resilience of his businesses. – By MENA Newswire News Desk.