close
close

Association-anemone

Bite-sized brilliance in every update

As Tesla CEO Elon Musk continues to bash California and bash Trump, West Coasters are retaliating
asane

As Tesla CEO Elon Musk continues to bash California and bash Trump, West Coasters are retaliating

The battery that once fueled a great love between adze CEO Elon Musk and California car buyers is slow disappearing

New records of adze The Golden State’s Model Y slumped for the full year, with its market share down 8.5 percent from last year, according to Experienced Car data. California New Car Dealers Association Third Quarter perspective report published on Friday reveals the dominance of the electric vehicle manufacturer in that of the country the biggest market for battery electric vehicles (BEVs) continued to erode. Among the top three passenger cars sold in California, the Tesla Model 3 fell to third place, behind Honda Civic and the Toyota Camry, potentially opening the door for a full acceleration free-for-all among automotive brands.

Overall, Tesla’s brand share fell from 13.6% to 12.1% year-to-date. Being outsold by non-luxury brands like Honda and Camry is a red-blinking change in the overall competitive landscape. The Model 3 catapulted Tesla onto the main stage as a mainstream brand, but now it faces a new cast of rivals, including Cadillac, Lexus, Hyundaiand BMW, all of which have seen major gains over the past year. Cadillac, for example, saw a 315.2% increase in BEV registrations, while Tesla fell from 63% to 54.5%.

There may also be increased market tension due to California’s strong Democratic-leaning population, which is more likely to buy an electric vehicle, and Musk’s support for Trump. The CNCDA report, which tracks trends in California’s new vehicle market, comes as electric vehicle CEO continuously praised Republican presidential candidate Donald Trump. The share of registered Democrats in California rose to 45.3 percent as of 2020, while Republican registration remained steady at about 23.9 percent, according to Public Policy Institute of California. Meanwhile, a study 2020 found that US Democrats are much more willing to adopt electric vehicles than Republicans. And California’s year-to-date BEV market share is 22.2 percent, compared to an overall U.S. market share of 7.9 percent, CNCDA reported.

Plus, Musk hasn’t been kind to California. He publicly committed to moving SpaceXand X out of state and in Texas this year. The “punch” came after Gov. Gavin Newsom signed into law the Supporting Academic Futures and Educators for Today’s Youth (SAFETY) Act, aimed at banning forced-out policies in schools. Musk said it amounted to an attack on families and businesses.

It might not hurt that Democratic presidential nominee Kamala Harris is a California native. The vice president lives in Washington, DC, but she and husband Doug Emhoff own a 5 million dollar mansion in Brentwood, California.

CNCDA President Brian Maas said wealth there are probably several factors underlying the trend.

“We believe Tesla’s slippage could occur for a number of reasons, starting with market saturation,” Maas said in a statement. “Californians who wanted and could afford Teslas mostly already did.”

In addition, Tesla has not released any new affordable models, other than the “very niche and expensive Cybertruck,” he added. There are now even more options from traditional car manufacturers. “And that’s all before bringing up Musk’s political views and comments, which don’t align with many Californians, particularly his original customer base of Bay Area drivers,” Maas said.

Tesla did not respond to a request for comment.

Why is Tesla stock rising?

Still, Tesla has been on a tear this week, up 22% after a successful earnings call and report fueled its best performance since 2013. Part of that was due to Tesla’s report that $80,000 Every Cybertruck turned a profit for the first time. The rally sent Musk personal wealth grew by another $34 billion, pushing his net worth to $270.3 billion in a single day.

And Musk hinted that Tesla has more innovations in store. This month, Tesla announced a self-driving robotaxi called the Cybercab and a fully autonomous Robovan with enough room for a family. On Wednesday, Musk confirmed that the robotaxi made maiden voyages under the auspices of Tesla employees on the streets of San Francisco. The world’s richest man said during the earnings call that other car companies will find themselves at risk if they don’t focus on autonomy, as Tesla has.

“A lot of car companies, or most car companies, haven’t internalized this, which is surprising, because we’ve been shouting this from the rooftops for so long, and it’s going to stack up against them going forward,” Musk said .

Certainly, the Tesla Model Y is still the best-selling car in California to date, CNCDA reported. And, Tesla is the second best selling brand in California after Toyota. Additionally, the Model Y competes in the coveted SUV/crossover segment that dominates the market. The Model 3 competes in the shrinking passenger car segment, where sales fell 13.1 percent, while SUVs rose 3.4 percent. The Model Y sells almost three times the volume of the Model 3.

Whether that future could be in jeopardy because of Musk’s political affiliation remains to be seen. His strong political stance was counterintuitive compared to other high-ranking CEOs. A representative for JPMorgan Chase CEO Jamie Dimon, for example, issued a denial this month, when Dimon had endorsed Trump.

Overall, this trend has held for much of this election season. However, talk of workplace politics is likely to intensify over the next few weeks as the votes are tallied and employees head to the polls in November.

Kate Duchene, CEO of global professional services firm RGP, said wealth that since the pandemic, people have continued to merge their personal and professional worlds, so it’s probably inevitable that there will be more talk.

“For any company, it’s becoming increasingly difficult to keep political conversations completely out of the workplace,” said Duchene, who consults with 70 percent of Fortune 500 companies. “Businesses and managers should be aware that these those kinds of conversations are more than likely to happen, especially in the coming weeks. When it comes to political discussion, diversity of opinion should be welcomed in the workplace as long as all parties keep it professional and respectful.”

This story was originally presented on Fortune.com