Tesla and tariffs
Musk’s DOGE involvement is no longer the biggest threat to Tesla shares coming out of the White House.
On the same day that Tesla announced its delivery miss, Trump unveiled his long-awaited tariff regime. This was both broader and deeper than many observers had expected, and had huge implications for global trade.
While most of the ‘reciprocal’ tariffs on individual countries have been paused for 90 days, a 10% baseline tariff remains on all imports to the US. This rises to 25% for auto imports, as well as for steel and aluminium.
More worrying yet is the trade war that ramped up rapidly once China responded by placing its own tariffs on US imports. That prompted a rapid-fire ratcheting up of each nation’s tariff barriers.
By 11 April, trade between the two superpowers had effectively been nullified; China is levying 125% on US imports, while US imports from China are subject to a 145% tariff.
That’s not good for anybody, but it’s particularly bad news for companies like Tesla. Not only is China the world’s largest market for electric vehicles (EVs) but it is also home to much of Tesla’s production and supply chain. Tesla’s gigafactory in Shanghai reportedly produces around half of all its cars.
The trade war between China and the US could hit Tesla particularly hard. Its gigafactory in Shanghai produces around half of all the world’s Teslas.
Given the tariffs came into effect after the reporting period, they won’t have any impact on Tesla’s Q1 results. However, make no mistake: talk of tariffs will likely dominate the post-earnings call.
Musk has made a rare break with the White House party line on tariffs, clashing publicly with Trump’s senior trade advisor Peter Navarro – who Musk has referred to as a “moron” and “dumber than a sack of bricks”.
Tesla shares down at start of earnings week
It has been a torrid few months for Tesla's share price, and the selloff continues this morning as the stock opens 4.6% below its close last week.
Tesla's market cap is currently around $776 billion, having been over $1 trillion just two months ago.
Read more: Should you invest in Tesla?
The DOGE days are over?
Despite its delivery miss, Tesla’s shares eventually gained on 2 April, thanks to a Politico report suggesting that Musk would be stepping back from his work with DOGE in the coming months.
The report wasn’t confirmed – and has been contradicted by official White House statements. As such, Musk’s relationship with DOGE is likely to come under the microscope following Tesla’s earnings release tomorrow.
“We would expect Musk to address his role in the Trump Administration, and he will be asked about if he plans to stay in an advisory role for the White House,” says Dan Ives, global head of technology research at Wedbush Securities.
“We view this as a fork in the road time: if Musk leaves the White House there will be permanent brand damage, but Tesla will have its most important asset and strategic thinker back as full time CEO,” Ives continues.
Musk’s involvement with Trump and DOGE has already damaged the Tesla brand, according to Wedbush’s Dan Ives. Here, an activist in Washington DC holds a sign symbolising Tesla’s share price decline during a protest in March.
“If Musk chooses to stay with the Trump White House it could change the future of Tesla/brand damage will grow,” says Ives. “A huge week ahead for Musk, Tesla, and investors.”
Deliveries and DOGE
Tesla’s earnings are unusual among the Magnificent Seven, in that investors usually have a fairly good idea of how the preceding quarter has gone from a sales perspective. This is because Tesla announces its delivery numbers for the quarter several weeks before it releases its full results.
On that basis, analysts have been slashing expectations ahead of Tuesday’s release. Tesla’s delivery miss during Q1, announced on 2 April, saw quarterly vehicle sales fall to their lowest level for nearly three years.
Analysts had forecast 498,000 deliveries; Tesla fell short, with 495,570.
It’s thought that CEO Elon Musk’s close association with the Trump administration, as well as his activity with the Department of Government Efficiency (DOGE) contributed to the miss by prompting a widespread backlash against Tesla cars.
Tesla CEO Elon Musk’s political activities have caused a backlash among consumers, even Tesla fans. This bumper sticker was photographed in Lafayette, California on 28 March, 2025.
Markets will have already priced in a poor set of financial results for Tesla for Q1. However, of all the Magnificent Seven stocks, Tesla’s valuation is often based far less in what it has done before, and what markets expect it to do in the future. We’ll be delving into the details of what markets will be watching out for, particularly during the all-important post-earnings call.
When does Tesla announce earnings?
Tesla announces its earnings after US markets close on Tuesday 22 April – that is, soon after 4pm UK ET, 9pm in the UK.
The post-earnings call, which is likely to have the biggest influence on the market reaction, is scheduled for 5.30pm ET (10.30pm in the UK).
Tesla earnings release kicks off Magnificent Seven results
Good afternoon, and welcome to our live blog covering Magnificent Seven earnings season, starting with Tesla’s results on Tuesday 22 April.
Like last week’s UK inflation data, the upcoming round of big tech earnings promises to be something of a snapshot into a bygone era, with the sweeping tariffs that president Donald Trump announced at the beginning of Q2 2025 having completely upended the stock market and thrown all future forecasts out of the window.
The Magnificent Seven – Tesla especially – have, however, been judged far more on their future outlook than their past performance over recent years, though. More than ever, this earnings season promises to be one of volatility and unpredictability, as nervous global investors watch for any clues as to the future of US tech dominance.
We’ll bring you live updates and rolling analysis, to help you keep track of every major development as it happens.