| Tesla CEO Elon Musk on Tuesday tried to appease investors worried about its poor performance by saying he’s pulling back from government work. But as Businessweek senior reporter Max Chafkin writes today, his ties to Donald Trump and his unpopular policies can’t be cut that easily. Plus: India’s high tariff on cars is facing pushback now, and why amusement parks are on a mission to scare. If this email was forwarded to you, click here to sign up. There’s a bit of corporate jargon that’s useful to describe the circumstances faced by Tesla Inc., Elon Musk’s electric-car company: “headwinds.” The meteorological term, generally deployed by companies to explain away poor performance, will be familiar to anyone well-versed in the lexicon of the American CEO—though it seems especially apt at this moment. Businesses of all sorts face staggering uncertainty, starting with President Donald Trump’s tariff policies and retaliation from other countries, the possibility of a financial crisis or recession (or both), the potential that Trump might bully the chair of the Federal Reserve into doing something disastrous, and perhaps an end to the era of economic and political dominance the US has enjoyed since the end of World War II. All of these are problems for Tesla, which reported earnings on Tuesday and revealed that it had one of the worst quarters in its history. There were sinking sales, declining profits, a diminished forecast and a huge gap between analysts’ expectations and the company’s actual performance over the previous three months. Musk did his best to wave all of this away, in part by talking up the prospects of his autonomous vehicle and robotics plans, and in part by blaming forces that were, at least in his accounting, entirely outside of his control. He complained about tariffs, anger from customers over his involvement with Trump’s so-called Department of Government Efficiency and general macroeconomic uncertainty. “While there are many near-term headwinds for us,” Musk said on the company’s quarterly earnings call, “the future for Tesla is brighter than ever.” Musk is a savant in the fine art of deflection—and the stock responded positively today. Tuesday’s conference call was a master class in the form. After all, Musk has been one of the key players in the external forces he’s complaining about. The headwinds are coming from inside the Cybertruck. “I’m not the president,” Musk said, repeatedly arguing that Trump’s decision to implement tariffs was his own. Which is true enough, but avoids mentioning that tariffs were a signature issue of Trump’s candidacy and that Musk was the largest donor. When Musk was crisscrossing Pennsylvania, while spending unprecedented sums on the election—around $300 million in a matter of months—what exactly did he think that money would buy him? One answer, of course, is DOGE, which Musk personally pitched to Trump last summer and has championed ever since as existential—to the US and, possibly, to civilization itself. Unfortunately for Musk, it turns out that gleefully cutting funds to food pantries and religious aid workers while cosplaying as a management consultant is wildly unpopular. During the earnings call, Musk’s deputies acknowledged that his transformation from widely admired green capitalist to trolling Trump surrogate was hurting the company’s sales. As the company’s chief financial officer, Vaibhav Taneja, put it diplomatically, the company was experiencing an “unwarranted hostility toward our brand,” seemingly out of nowhere. In Musk’s mind—and in his own account during the call—none of this was his fault either.  Members of the climate protest group Extinction Rebellion painted messages at a Tesla showroom in New York City on Tuesday, which was Earth Day. Photographer: Stephanie Keith/Getty Images He blamed protests that he said were funded by the “fraudulent money” of the programs that DOGE was attempting to cut. Leaving aside that this wouldn’t exactly speak well of DOGE, and that the activists have denied paying protesters, Musk’s claims are hard to square with the obvious declines in his popularity in public opinion polls, not to mention the results of Wisconsin’s recent Supreme Court election, which he threw himself and his money into wholeheartedly and lost. Anger against Musk is hardly the exclusive domain of Musk’s favorite nemesis, the media, nor the left-wing groups that have made him central to their activism. Investors, even some of the most committed Tesla bulls, know this well. In the days before the earnings call, Dan Ives, who just a few months ago was calling Musk’s support of Trump “a total game changer” that would be a “bet for the ages,” urged Musk to leave government and focus on running Tesla. “Anyone that thinks the brand damage Musk has inflicted is not a real thing, spend some time speaking to car buyers in the US, Europe, and Asia,” Ives wrote in a note on Sunday, as reported by my colleague (and Elon, Inc. co-host) Dana Hull. “You will think differently after those discussions.” The big news Tuesday, beyond the usual boasts about the brave new autonomous future that Musk has promised for almost a decade (without much to show for it), was that Musk is indeed stepping back from DOGE. “I think starting probably next month, in May, my time allocation to DOGE will drop significantly,” Musk said. The promise was actually less surprising, and probably less significant, than it might seem. Since the beginning of the Trump administration, we’ve known that Musk’s days in Washington would be limited by his status as a special government employee, a category of federal worker restricted to about four months of full-time employment a year. Moreover, Musk made clear that although he regards DOGE’s work as “mostly done”—a strange claim given how far short the group has fallen of its plan to cut $2 trillion from the federal budget—he has no intention of giving up his status as the most enthusiastic member of the presidential entourage. Musk said he’d still spend “a day or two per week” advising Trump for the next three-and-a-half years “just to make sure that the waste and fraud that we stopped does not come roaring back.” I assume the breakfast buffet at Mar-a-Lago isn’t bad either. Two days a week would be a huge time commitment for a man who runs six companies—and ensures that Musk will be tied to Trump’s most unpopular policies for the foreseeable future. This isn’t to say that Musk won’t benefit from the continued association with the world’s most powerful man—there are numerous signs that he’s attempting to funnel government contracts to his other companies, especially SpaceX. But it also means that those pesky headwinds he mentioned on the Tesla call aren’t going anywhere. On the latest Elon, Inc. podcast: At least Neuralink is doing well. Listen and subscribe on Apple, Spotify, iHeart and the Bloomberg Terminal. | 
