In recent years, as Elon Musk has become more vocal and politically visible, observers have debated whether his activism has weakened or strengthened the Tesla brand. Some argue that Tesla has alienated left-leaning consumers who previously saw the company as synonymous with liberal progress and climate commitment. Others argue that Musk’s positioning appealed to right-wing buyers who previously viewed electric vehicles (EVs) as out of step with their cultural identity.
With CEOs — from Apple’s Tim Cook to Salesforce’s Marc Benioff — increasingly involved in political activism, companies across industries face a similar dilemma: When a leader becomes a politically polarizing figure, how do you measure the impact on the brand and what’s the best path forward?
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To investigate these questions, we conducted a large-scale study of vehicle buyers in the United States that simulates real purchasing decisions, forcing consumers to make choices between brand, price and product features.
Musk and the Tesla brand
Tesla’s identity has always been linked to its CEO. Musk was the company’s public face, its chief storyteller, product visionary and cultural symbol. For years, this visibility has worked in Tesla’s favor, helping transform an electric vehicle into an aspirational product.
Starting in 2022, however, a series of highly visible actions changed the way Musk was perceived and, consequently, how Tesla came to be interpreted.
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His acquisition of Twitter (now X) and his partisan comments on the platform placed him at the center of polarized debates. This process was intensified with political support and campaign donations and culminated in a prominent role in the government.
Musk’s activism contradicted the image that many had of him until then. As a consequence, Tesla stopped being seen primarily as a technology brand and started to function as a reflection of the political positions defended by its CEO.
Musk and Tesla at a crossroads
When a brand becomes politically polarized due to its CEO’s activism, the company has three main strategic paths. Our study helps clarify the desirability of each of them.
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- Reverse political positioning
The brand can try to realign itself with its historical audience. This requires repeated and reliable actions. To do so, Musk may need to publicly distance himself from conservative political figures and demonstrate a visible realignment with liberal-leaning groups.
- Betting on political change
If the company’s leadership believes that the new consumer segment can grow and sustain higher prices, it is possible to adopt a strategy that deepens the CEO’s recent political stance.
Musk could also consider a return to neutrality or simply stop acting politically. However, this movement, in itself, would hardly change the current scenario, in which Tesla, on balance, lost space.
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- Improve product performance
The company must consider improvements to its products, especially in the core aspects of an electric vehicle’s performance, such as range and recharging speed. In our assessment, product innovation offers a less risky path forward for Tesla than a political retreat.
A broader lesson for management
The pattern identified by our study is not unique to Tesla. Companies embroiled in political controversies are often able to maintain strong performance by competing on the value of their products rather than ideology.
The lesson is not that companies should avoid political engagement altogether. Instead, when polarization causes divergent effects on brand perception, brands must rethink continuing this activism and, above all, ensure that their products and services are delivering consistent value.
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For executives and boards facing politically sensitive situations, the priority is not to eliminate polarization but to manage it.
- Diagnose how demand is changing
Companies must invest in understanding which consumer groups are becoming more supportive, which are moving away, and how big each segment is.
2. Separate brand perception from product value
Executives must assess how much of current performance is driven by brand perception and how much stems from core product attributes such as quality, functionality and price.
- Identify segments that can be recovered
These segments tend to respond better to performance improvements. Simulating the market with the current offer and analyzing the impact of product changes on different groups of consumers can provide valuable information.
4. Avoid reactive messages and emphasize the attributes that really matter
The goal is not to ignore politics, but to ensure that it does not take over the narrative. Companies that base their strategy on the value of their products are better positioned to navigate periods of polarization without being defined by it.
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