US businessman Elon Musk announced on Wednesday that he will significantly reduce his involvement in the Department of Government Efficiency (DOGE) starting in May. The billionaire made the decision amid falling profits at his Tesla company.
Musk said he now expects to spend “one or two days a week on government affairs.”
On April 22, Tesla reported a 71% drop in profits and a 9% drop in revenue for the first quarter.
Sales of Tesla’s electric vehicles in Q1 2025 fell 13% year-on-year to 336,681 units. This is the worst performance since Q3 2022, with analysts forecasting sales in the range of 360,000 to 390,000 vehicles.
Tesla has faced a number of challenges, including a sharp decline in demand in Europe and protests sparked by Musk’s remarks and actions. In addition, the company has come under pressure due to increased import tariffs in the US, which negatively affects its business, as well as other carmakers.
On April 20, Tesla postponed the start of production of the budget version of the Model Y crossover in the US for at least several months. Initially, the company planned to launch production of this model in the first half of 2025. Tesla intended to produce 250,000 budget electric cars in the US in 2026. The new car was also planned to produce in China and Europe.
DOGE is tasked with cutting government spending and restructuring federal agencies. Thousands of federal employees, including veterans in the civil service, have been laid off since the department’s filing, and the US has also drastically cut aid to other countries.
