The potential launch of the America Party by billionaire Elon Musk could result in him committing more time to politics once again, putting key time with Tesla Inc. (NASDAQ:TSLA) on the back burner.
What Happened: Passage of the "Big Beautiful Bill" by Congress and President Donald Trump could be bad for Tesla and the electric vehicle sector due to the elimination of the $7,500 consumer tax credit and no demand for Tesla's regulatory credits.
While this could be negative for Tesla, the billionaire's deeper push into politics could also be bad for the company if Musk spends more time working on creating the party, naming candidates and overseeing upcoming election efforts.
Benzinga recently polled readers to see if they think Musk's potential new party launch could hurt Tesla stock.
"Does Elon Musk's renewed political push help or hurt Tesla stock over the next 12 months?" Benzinga asked.
The results were:
- Hurts – stock falls: 71%
- No real impact: 18%
- Helps – stock rises: 11%
While Musk may have benefited from his endorsement of Trump and his political involvement ahead of the 2024 election, readers don't see the same happening with the launch of a third-party.
Tesla stock reached an all-time high in December 2024, following Trump’s election victory, with the EV leader viewed as a potential winner due to the close relationship between the president-elect and Musk.
The stock eventually fell in early 2025 as Musk dedicated more time away from Tesla, helping lead the Department of Government Efficiency, known as DOGE.
71% of Benzinga readers see Tesla stock falling in the next 12 months if Musk commits more time to politics.
Why It's Important: The poll results showing a potential decline in Tesla’s stock price come as Wedbush analyst Dan Ives argued that Tesla's board of directors needs to "act now" and help establish rules for Musk to manage Tesla and his political ambitions.
Ives calls on Tesla’s Board of Directors to take “the bull by the horns” and do the following three things.
1. Develop a new incentive-driven pay package for Musk, which increases his ownership stake in Tesla to up to 25% voting power. Ives said this could help the possibility of Musk merging Tesla and xAI.
“This would solidify Musk as CEO of Tesla over the coming years as we expect him to be CEO at least until 2030.”
2. Include requirements for the time commitment to Tesla operations as part of Musk's pay package. Ives said the Board should provide some “general guardrails” on Musk’s time to help clarify expectations for institutional investors, retail investors, Tesla employees, the Tesla Board and Musk himself.
3. Create a special Board oversight committee. Ives said this Board would center on Musk’s political ambitions and would have ground rules of what could violate his pay package. While Tesla’s Board of Directors cannot control who Musk donates to politically, Ives said the Board can have oversight to ensure his political ambitions don’t “interfere with his role as CEO of Tesla."
Tesla stock is down 21.9% year-to-date in 2025, with shares currently trading at $296.42.
Musk's political push is not the only factor in Tesla's stock decline. Other issues, such as falling demand and the loss of EV tax credits, are also likely contributing factors.
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The study was conducted by Benzinga from July 7, 2025, through July 8, 2025. It included the responses of a diverse population of adults 18 or older. Opting into the survey was completely voluntary, with no incentives offered to potential respondents. The study reflects results from 55 adults.
Photo: Shutterstock
