Donald Trump may be pleased enough with Elon Musk, but even as the Tesla CEO is exercising his newfound power to essentially undo whole functions of the federal government, he still has to reassure his investors. Lately, Musk has delivered for them in one way: The value of the company’s shares has skyrocketed since Trump was reelected to the presidency of the United States. But Musk had much to answer for on his recent fourth-quarter earnings call—not least that in 2024, Tesla’s car sales had sunk for the first time in a decade. Profits were down sharply too. Usually, when this happens at a car company, the CEO issues a mea culpa, vows to cut costs, and hypes vehicles coming to market soon.

Instead, Musk beamed about robotics, artificial intelligence, and Tesla’s path to being “worth more than the next top five companies combined.” This is the vision he has been selling investors for years: Making cars—a volatile, hypercompetitive business with infamously low profit margins—was only the start for Tesla. Its future business will be making fleets of self-driving taxis and humanoid robots trained for thankless manual labor. Whether his vision has any connection to reality is hotly debated by many AI and robotics experts, but most Wall Street analysts put their faith in Musk. And he has, at times, delivered on wildly ambitious goals. Shares jumped again after the call. (Tesla did respond to a request for comment; a DOGE official did not respond to an email seeking comment.)

Musk gets the benefit of the doubt from investors because—despite undelivered promises, half-baked ideas, and forgotten plans—he has made Tesla worth, on paper at least, more than essentially the rest of the auto industry combined. His funders are asked to buy Musk’s picture of the future, and the recent enthusiasm for Tesla stock suggests they believe that his political influence will help him get there.

Musk needs that belief to hold. Tesla’s stock price is the largest source of his enormous wealth and, by extension, his influence; if his plans succeed, that stock is also his clearest shot at achieving trillionaire status. Right now, though, Tesla’s primary business is still selling cars that people drive, and Musk himself may be the biggest reason that faith in Tesla could falter.

For all of Musk’s ire for the former president, Tesla did very well in the Joe Biden years. The Model Y is the world’s best-selling electric vehicle and its best-selling car, period. The company has comfortably been out of its “money-losing start-up” phase for years. Although the competition among EV makers is heating up, the only individual company close to eating into Tesla’s market share is China’s BYD, which for the first time last year produced more EVs than Tesla did.

Yet that competition can’t entirely account for Tesla’s latest, abysmal numbers. Last year, Tesla sales were down nearly 12 percent in the EV stronghold of California. And in Europe, where Musk is helping supercharge far-right politics, Tesla’s sales were down 63 percent last month in France and 59 percent in Germany. This is happening even as the rest of the worldwide electric market is growing fast; nearly every car company that makes EVs saw sales gains in 2024, some of them huge.

Musk’s activism does seem to be turning off the affluent or middle-income progressive crowd that was traditionally Tesla’s bread and butter. Look no further than how the company’s new, updated Model Y has been received. Musk’s army of fanboys on X was as effusive as ever, but outside the hard-core Tesla bubble, the SUV was met with a flood of Nazi jokes following Musk’s Sieg heil–ish arm gesture at Trump’s inauguration. This type of reaction goes beyond that one car; the Cybertruck has a unique penchant for being the target of vandalism, and people appear to be making a killing selling anti-Musk bumper stickers to disgusted Tesla owners. In covering the auto industry, I can’t go a week without fielding emails from people asking for advice on the best EV alternatives to Tesla—many from longtime Tesla owners who say they’re ready to move on.

In theory, Musk’s rightward turn could help him swap out traditionally liberal buyers for more conservative ones, who usually tend to be more skeptical of EVs. And it’s likely that EVs will become less polarizing along partisan lines over time as electrification becomes more common on new cars. Right now, however, even the deep-red-coded Cybertruck doesn’t seem to be changing many minds about the concept of battery-powered cars. Take a recent report from the EV Politics Project, a nonprofit group that studies the partisan divide over electric cars. Their study indicates that although Musk himself is now viewed much more favorably by Trump voters and Republicans, he’s not leading some seismic shift in how they view EVs.

Nor is he obviously trying to get MAGA voters to buy the new Model Y. In fact, those who follow the auto industry closely wonder if Musk is still interested in running a car company at all. On that January earnings call, he offered only a boilerplate response about “more affordable” new Teslas coming soon; the word Cybertruck was not uttered once. He is, however, clearly focused on the company’s “unsupervised” robotaxi service. (Imagine Uber, except with Model Ys and Model 3 sedans, and with no humans behind the wheel.) He claims that Tesla will launch the taxis in Austin in June, the first step toward turning the company into the AI powerhouse that Musk thinks will make it so valuable. Right now, his AI ventures are separate, but he’s started mingling them with his ambitions for Tesla. Ultimately, his thinking—which he’s articulated in earnings and public appearances over a number of years—is that his roving network of autonomous vehicles can use their cameras to capture huge quantities of data, and those data can be used to train AI networks.

In the immediate future, Musk wants Tesla robotaxis everywhere, as soon as possible, and sleeping next door to the White House could help advance that part of his vision. Critics have expressed concerns that his newfound influence could also help stymie federal investigations into Tesla, which are probing the crash record of the company’s “Full Self-Driving” technology and its claims about the technology’s safety. And his current political position could help eliminate one of his oldest foes: regulations.

Tesla has long clashed with environmental rules (last year, a California judge ordered Tesla to pay $1.5 million over allegations that it mishandled hazardous waste), labor laws (employees at a Tesla plant have said that the company failed to pay overtime, among other alleged violations), and safety ordinances (the company was recently fined for violating California’s workplace-heat-safety rules at one of their plants). But the greatest roadblock to Musk’s vision of robotaxis everywhere is arguably America’s current patchwork of state-by-state rules and regulations for autonomous vehicles, which may allow self-driving cars in some places but not others. No federal standards currently exist, but creating rules favorable to the industry would speed things up—especially if those rules were tailored to especially benefit Tesla.

Musk’s approach to Tesla’s future has more than a few problems that the rest of the self-driving-car industry does not face. Tesla relies solely on cameras and AI for its automated-driving systems, rather than lidar and other more advanced sensors used by competitors. Plenty of experts think Tesla’s strategy can never power true autonomous driving. And Tesla is already years behind robotaxi companies operating in many cities right now, most notably Google’s Waymo. Musk’s Tesla faces the rising threat of China’s advancements in AI too: Investors are noticing BYD’s autonomy-focused deal with tech upstart DeepSeek. And they’re noticing where Musk’s attention lies; as he holds court in the Oval Office, Tesla’s stock has begun losing all those postelection gains.

The most daunting problem, though, may be the same problem Musk has always had: people. Even if he does succeed in tearing down the regulatory state for the sake of his own companies, who’s to say anyone will buy what they’re selling. Any power Musk has in the future depends on turning millions of people into Tesla customers. If he can’t do that—or at least keep convincing investors that he’ll be able to—he’s just another guy screaming online.