Tesla's brand loyalty collapsed after Musk backed Trump, data shows
The data, which has not been previously reported, shows Tesla’s customer loyalty peaked in June 2024, when 73% of Tesla-owning households in the market for a new car bought another Tesla, according to an S&P analysis of vehicle-registration data in all 50 states
Highlights:
- Household vehicle-registration data shows fewer Tesla owners are opting for another one
- The EV maker for years had the highest customer loyalty in the industry
- Tesla also loses ground in its ability to win over customers from other brands
Tesla for years had more repeat US customers than any other major automotive brand but its loyalty has plunged since CEO Elon Musk endorsed President Donald Trump last summer, according to data from research firm S&P Global Mobility shared exclusively with Reuters.
The data, which has not been previously reported, shows Tesla's customer loyalty peaked in June 2024, when 73% of Tesla-owning households in the market for a new car bought another Tesla, according to an S&P analysis of vehicle-registration data in all 50 states.
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That industry-leading brand loyalty rate started to nosedive in July, that data showed, when Musk endorsed Trump following an assassination attempt in Pennsylvania on the Republican nominee.
The rate bottomed out at 49.9% last March, just below the industry average, after Musk launched Trump's budget-slashing Department of Government Efficiency in January and started firing thousands of government workers.
Tesla's US loyalty rate has since ticked back up to 57.4% in May, the most recent month the S&P data is available, putting it back above the industry average and about the same as Toyota but behind Chevrolet and Ford.
S&P analyst Tom Libby called it "unprecedented" to see the runaway leader in customer loyalty fall so quickly to industry-average levels. "I've never seen this rapid of a decline in such a short period of time," he said.
Tesla and Musk did not respond to requests for comment.
On Monday, Tesla granted Musk 96 million shares worth about $29 billion, a move aimed at keeping the billionaire entrepreneur at the helm as he fights a court ruling that voided his original pay deal for being unfair to shareholders.
The timing of Tesla's plunging brand loyalty suggests the CEO's involvement in politics turned off customers in the EV pioneer's eco-conscious customer base, some analysts said. "If they have Democratic leanings, then perhaps they consider other brands in addition to Tesla," said Seth Goldstein, an analyst at Morningstar.
