By Thomas Mustac, Publicist – Otter PR
Electric vehicle (EV) company Tesla currently faces significant PR challenges due to CEO Elon Musk’s behavior and public statements over the past year. As a result, the company’s sales have slowed and the share price has dropped.
Tesla needs to repair its brand and reconnect with customers. Failure to do so could worsen the company’s downturn. Here’s what the company should do to reverse course.
The making of Tesla’s public relations crisis
In the past year, Musk has become increasingly outspoken on political issues. During the 2024 election, he became a prominent donor to the Trump campaign. Since Inauguration Day, he has taken a senior role in the new administration, helming the controversial Department of Government Efficiency (DOGE).
Musk’s activism has driven previously loyal market segments away from Tesla and created brand-related concerns. In the first quarter of 2025, Tesla sales decreased 13 percent, which is the biggest decline the company has ever seen. The value of the company’s shares has fallen 44 percent since the start of the year in what CNBC calls Tesla’s “worst quarter since 2022.” Meanwhile, protests have begun to spring up around Tesla dealerships.
These public relations problems endanger Tesla’s future.
High stakes for Tesla
Until recently, Tesla has enjoyed its position as a technological leader and market disruptor. Today, however, the company’s identity as an EV leader is in question, as well as its ability to win back consumer and investor loyalty.
The company risks many negative outcomes if the board of directors neglects to act effectively at this critical moment in the company’s history. First and foremost, the brand could continue to hemorrhage brand loyalty, and customers could continue to spend their money elsewhere. Meanwhile, rival companies, such as startups Rivian and Lucid, as well as established car manufacturers eager to gain market share, will be more than happy to offer consumers a non-ideological option for their new EVs.
Additionally, the company may continue to attract negative media coverage. This not only erodes brand image but also tends to heighten investors’ concerns. In consequence, the company’s stock prices could continue to plunge or see unnerving bouts of volatility. Indeed, the longer Tesla’s board of directors fails to take action, the more investors may perceive the company’s governance as weak, leading them to rethink their allocations. Inaction could also attract scrutiny from regulators.
To avoid these outcomes, Tesla’s board of directors needs to develop and implement a savvy public relations plan to overcome these challenges.
What Tesla’s board can do: Stronger governance
The good news is that a comprehensive PR strategy would help Tesla turn its prospects around. First and foremost, the board should implement active measures that prioritize the business’s success.
Previously, Musk’s celebrity and reputation as a visionary leader with an unconventional management style may have worked in favor of the company. Today, however, his personal interests and “side gigs” should no longer be allowed to take precedence. The company needs balanced, stable, independent governance to assuage investors’ and consumers’ concerns. This means the board should take steps toward a new, stronger governance structure.
To do so, Tesla should establish a Reputation & Risk Management Committee to assess the likely impact of leadership decisions and develop appropriate responses. It should also couple their CEO’s salary and incentives to customer satisfaction, operational stability, and ESG performance rather than stock performance, as it is today. This stakeholder-centered approach would promote the company’s sustainable growth.
In addition, the board should set controls on Musk’s use of social media. Legal and communications departments should vet potential posts before they go live to avoid legal risk and inappropriate disclosures.
Musk himself can also help matters by departing from politics.
What Musk can do
If Musk were to leave politics and return to his businesses, then the amount of controversy he is embroiled in can be expected to decrease. Tesla and his other companies would also benefit from his time and attention.
Such a development may already be in the works. As a “special government employee,” Musk is only eligible to serve for up to 130 days, a time period that would expire in late May or June. Accordingly, Politico has reported that Trump has told those close to him, including members of the Cabinet, that Musk will be leaving his position within the administration. Musk is expected to continue advising the President on an informal basis, however.
Tesla, as a company, can also help repair the damage to its brand image.
What Tesla can do as a company: Reinforce core brand values
To improve relationships with customers, Tesla should focus on reinforcing its core brand values.
In particular, Tesla appeals to many consumers because the company spearheads sustainable energy solutions. Moreover, it has a reputation for moving as quickly as possible to bring EVs and alternative energy sources to market, disrupting the conventional automotive and energy industries in the process. Tesla’s green cars also provide excellence in performance, beautiful design, and cutting-edge technology. This positions the ecological and ethical choice as the best choice, not a compromise or sacrifice.
Reminding consumers of these environmental initiatives can help restore customer trust. To that end, Tesla should demonstrate genuine environmental stewardship by releasing detailed reports on its sustainability efforts and raw material sourcing. It should also expand battery-recycling facilities alongside community solar installations for public buildings. In addition, the firm could retrofit its factories to obtain the best green building certifications.
By leaning into these aspects of Tesla’s brand, the company could improve customer and investor relations. In addition, the company should also draw on another of its strengths: its tried-and-true communications approach.
Communicating effectively and improving customer experience
Tesla has long eschewed traditional marketing and advertising, instead relying on social media and direct-to-consumer interactions. While these messages occasionally venture into provocative territory, they also enable the company to appear authentic. This quality is paramount to today’s consumers, who increasingly value brands that deliver authenticity.
Tackling the company’s history of poor performance in the realm of customer service would also help. Right now, the company requires people to interact with the company exclusively via their mobile app. This approach lacks the kind of personalization and connection that today’s customers desire.
The company could open Care Centers or deploy mobile service fleets that provide in-person consultations and support to existing and potential customers. It should also partner with licensed independent repair centers to boost capacity. In addition, the company could create a Service Guarantee and make it public, instilling confidence that customers will receive prompt and reliable service when they need it.
Another idea would be for Tesla to report on the improvements it has made to its products and services based on customer feedback. This would demonstrate the company’s dedication to transparency and continuous improvement, characteristics that also foster trust.
Tesla can repair the damage
Tesla might be in trouble, but the company can still change its fate. If the board asserts itself, Musk drops his political ambitions, and the company focuses on its core values, then Tesla can hope to repair the damage that has been done to its brand image. Genuine action to display environmental leadership and improve the customer experience, along with a savvy communications strategy that appeals to today’s customers, can make the difference.
— Thomas Mustac is one of Otter PR’s crisis communications specialists, as well as an expert in medical and health industry PR. He previously held positions at the Dr. Oz Show and New York Medical College. He has earned his Master’s Degree from Iona College and received an Advanced Certification in Nonprofit Public Relations. His diverse background includes PR in healthcare, pharmaceutical, telehealth, tech, cosmetics, sports, and interior design.
