Musk’s Controversy Becomes Tesla’s Sales Fight

Musk’s Controversy Becomes Tesla’s Sales Fight


Bloomberg – Dennis Levitt won his first Tesla (TSLA), a blue Model S, in 2013, and he loved it. “It was better than any car I’ve ever driven,” says the 73-year-old private storage executive.

He bought the brand, as did Elon Musk, the philanthropic CEO of Tesla, ready to get another Model S the following year and drive the first car across the country. In 2016, he stood in line at a showroom near his home in suburban Los Angeles and was one of the first to order two Model 3s — one for himself and one for his wife.

“I was a fan of Musk,” says Levitt.

It’s gone, because while Levitt still loves his Teslas, he’s sour with Musk. “After a while, his public remarks really bothered me,” Levitt said, citing the CEO’s feud with US President Joe Biden, among others. “He’s acting like a seven-year-old.”

Musk had a relationship with Sergey Brin’s wife, which he denied; got into an imbroglio to acquire Twitter (TWTR); he had twins with an executive at his brain interface center Neuralink; SpaceX officials called it “a constant source of discomfort and embarrassment”; his daughter changed her name and legal gender after her personal history; was accused of paying a SpaceX employee $250,000 to settle complaints that he sexually harassed her, allegations he called false. Musk’s behavior has alienated potential customers and angered other Tesla owners..

The trends have been observed in one consumer survey and one market research report after another: Tesla commands high brand recognition, consideration and loyalty, and customers are more satisfied with their cars. Musk’s antics, on the other hand? They could avoid it.

Creative Strategies, a California-based customer experience measurement unit, cited the owner’s frustration with Musk in a study published in April. A year earlier, research firm Escalent said that Musk Was the Most Negative Part of the Tesla Brand Among Electric Car Owners Surveyed..

“We heard Tesla owners say, ‘Look, I love my car, but I really wish I didn’t have to answer to my friends and family about your latest tweet,'” says Mike Dovorany, who has spoken to thousands of people, including electric car owners. and potential buyers, during his two years working at the automotive and mobility group Escalent.

So far, Tesla has had no trouble overcoming Musk’s many controversies. The drop in car shipments the company reported last quarter was its first drop since the start of 2020 and was largely related to the Covid lockdown in Shanghai, forcing its most productive factory to close for weeks. Competitors that have held onto the company for a decade may still be years away from catching up on electric car sales.

Musk’s star power, built in large part by his activity on Twitter — the same platform on which he became a lightning rod — did a lot for Tesla, especially as he eschewed traditional advertising. His steady stream of online satire, punctuated by the occasional major ad, has kept Tesla in the headlines. During the early days of the company, negative feedback was a feature, not a bug. They allowed Musk to create media coverage and made him the leader of Tesla’s legion of online fans.

But after making Tesla and himself equal to each other, Musk entered into political conflicts, he tried to buy one of the world’s most influential social media platforms and struggled to deal with unsavory publicity about his personal life, putting the company’s increasingly valuable brand at risk.

Jerry James Stone, a 48-year-old chef from Sacramento, Calif., who teaches 219,000 YouTube subscribers how to make vegetarian and vegan meals, drives a Beetle convertible and plans to switch to electric. Still not sure which model, but you’re sure it won’t be a Tesla.

“Elon smeared this brand on me so much that I don’t think I’d even take it if I got it,” says Stone. “You have this guy who’s the richest man in the world, who has a big megaphone, and he’s using it to call someone a bully who he’s not, or to shame people, all these things that are bad.”

According to Strategic Vision, an American research firm that consults with car companies, about 39% of car buyers say they will not consider Tesla. This is not necessarily unusual – almost half of respondents said they do not consider German luxury brands. But Tesla is behind most brands in the market: Toyota, for example, is off the shopping list for 23% of drivers.

Emma Sirr, a 28-year-old cloud computing worker who lives in Bozeman, Montana, travels with her boyfriend and their two dogs in a 2004 Nissan Frontier. They’ve been researching electric cars for about three years and until recently focused on Teslas. only. a suitable choice, considering its independence and the payment infrastructure that the company has built in its territory. But they refused to buy one because of Muskhis main concerns are his politics, employee turnover in the company, and his arrogant approach to self-driving technology.

“We took Tesla off the table from the start,” says Sirr. He and his partner are looking at the Kia Niro and Chevrolet Bolt as possible alternatives. “As consumers, our power is what we buy. I think the younger generations, especially, vote with their wallets, and I feel like that could pay off in the future.

For most of the last decade, Tesla has had no competitors matching its models’ battery range and other performance measures. Consumers disillusioned by Musk’s antics had few electric cars to turn to. As traditional automakers introduce more capable electric models, Tesla won’t have as much freedom.

“We saw early adopters willing to take risks or put up with unusual things,” says Dovorany, who left Escalent for automotive technology startup earlier this year. “We don’t see that for incoming buyers.” To beat this group, automakers have to check all the boxes, and for some, that includes hiring a CEO who doesn’t share Hilter memes on social media.

Levitt, a self-proclaimed former Musk fan, tested last month for Lucid. He didn’t close the deal, in part, he says, because he didn’t have enough room to carry his golf gear. He is still waiting for another automaker to outbid Tesla and is considering models from Audi, Mercedes and BMW.

“If you take Mr. Musk and his equation antics, I’m 98% sure my next car will be a Tesla,” says Levitt. “Your love kept me in the game.”

See more at Bloomberg.com

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