Counter/Consensus: Musk Tarnishes Tesla, Re-shoring, German Elections and the War in Ukraine

1. Brands & Geopolitics (Consensus)

Le Tesla, c’est moi. Tesla’s brand favorability has declined across major European markets, in Canada and in the United States over the last three years. This may be due to a number of factors, including more robust competition in the EV market, Tesla’s slow rollout of an update to its popular model Y, a delayed robotaxi play, and hurdles in implementing full self-driving capabilities. 

However, analysts and many consumers also attribute some of the decline to CEO Elon Musk’s public political persona. While some consumers, particularly on the right, like what Musk is doing, in general views of Tesla have declined in Europe and North America since Musk began his takeover of Twitter in 2022. The last 6 weeks have been particularly dramatic as Musk has taken a major role in President Trump’s administration as the head of the Department of Government Efficiency (DOGE). 

When it comes to disentangling what may have European consumers upset with Tesla’s CEO, there is a lot to choose from. Many Germans took exception to Musk’s vocal support for the far-right Alternative for Germany (AfD) party in the leadup to the Feb. 23 general elections. In the United Kingdom, Prime Minister Keir Starmer may be largely unpopular, but many Brits may also not appreciate a foreigner openly calling for his ouster. The French government has called on the European Union to use tools at its disposal under the Digital Services Act (DSA) to censure Musk’s comments. And to top it all off, Europeans’ ire at the Trump administration more broadly may also be percolating through to their feelings about U.S. brands, especially one so closely tied to the president. While Musk has not been front and center in Trump’s tariff plans or his calls to annex Canada, there is nevertheless a petition to revoke his Canadian citizenship. 

Tesla has also seen its reputation decline relative to traditional automakers in the United States, but by a smaller amount than in Canada and Western Europe (roughly 10 points over 2024) and without the sharp post-election drop. 

And some Tesla models continued to be top sellers in the U.S. market in January. But a key forward-looking indicator raises questions about their relative appeal. If we look only among an audience that includes high-income households (defined as having income over $100,000) who said they plan to purchase an EV, 30% of them over the last month said they are considering a Tesla, placing the brand 6th out of the major automotive brands we track. But one year prior, that number was 32%, placing Tesla in third place.  

While it is difficult to tease out the impact of Musk’s public image on that of Tesla relative to other factors like the competitive landscape or regulatory impacts, consumers and competitors are pointing to Musk’s extracurricular activities as one aspect of the brand’s current struggles. It’s impossible to separate Tesla’s charismatic front man from its brand reputation globally, whether in Europe or California, where politics appears to be turning future EV owners off of Teslas, or in China, where Tesla may be viewed as a bargaining chip in the trade war. 

Where does this leave Tesla and, by extension, other U.S. automakers? Our prior research indicates that consumers have short memories once the news cycle moves on. Brand crises often fade quickly from mind once they are out of sight. Should Musk recede from public view, or no longer be so closely tied to Tesla, we would anticipate that other factors affecting views of Tesla would quickly reassert themselves in the public psyche. The likelihood of that, however, seems vanishingly small for the moment.

2. Trade War Reshoring (Counter)

Seeking friendlier shores? As a Trump-led global trade war continues to heat up with this week’s imposition of tariffs on Canada, China, and Mexico, re-shoring and onshoring have re-emerged as potential strategies multinationals are considering to preserve untariffed access to their global consumer bases. For example, U.S. companies sourcing parts and labor from Chinese factories may see benefits to reshoring stateside, while those serving European customers may onshore into the European market to avoid the so-called looming “reciprocal” tariffs. At first glance, our data suggests both strategies could be viable, but a closer look highlights some potential risks.

Per our H1 2025 Global Trade & Investment Policy Outlook, global public support for government efforts to facilitate local manufacturing is on the rise: It has trended upward in nearly every major market where we’ve tracked sentiment on the issue over the past 6 months. At first glance, this suggests global consumers would view both corporate re-shoring and onshoring in a favorable light. But in parallel, favorability toward openness to foreign direct investment (FDI) has declined modestly in most of these same markets, suggesting that what global publics really have in mind when they think about local manufacturing are efforts led by domestic companies as opposed to foreign ones. In short, consumers may favor re-reshoring, but disfavor onshoring.

On the one hand, these trends bode well for homegrown manufacturers who sought out markets with cheaper labor costs abroad and are now considering coming back home (such as U.S. companies who moved their production to China but are now entertaining the idea of opening a U.S. factory). In our view, this is a potential bright spot which could give homegrown multinationals a leg up relative to foreign competitors investing in the market directly or serving it via trade diversion out of tariffed countries. For companies in this position — most notably U.S. ones — we anticipate little in the way of reputational risks at home, assuming the cost dynamics underlying the re-shoring equation make sense.

On the other hand, the softening of public support for FDI could pose risks to foreign-domiciled multinationals’ public and government relations efforts — as well as material risks to revenue — should they choose to onshore and compete against homegrown champions in other markets.

As we note in our latest report, all of these trends have coincided with a late Q4 2024 rebound in pro-tariff sentiment, in a nod to public buy-in for retaliatory tariffs targeting the United States. And on the whole, they paint a darkening picture of global consumer attitudes that are conducive to economic fragmentation, marked by weakening trade and investment ties the world over. As Trump’s trade war ramps up, we expect reshoring to remain a potential bright spot amid an otherwise bleak landscape.

3. War in Ukraine (Counter)

All for one? Last week’s unprecedented Oval Office clash between U.S. President Donald Trump and Ukrainian President Volodymyr Zelenskyy over American-led efforts to end the war in Ukraine — which ultimately saw Kyiv left in the lurch, at least for now — reverberated across European capitals, whose leaders have been counting on an eventual U.S. security backstop for Ukraine. Faced with nothing of the sort, Europe’s political leaders — gathered together most recently by U.K. Prime Minister Keir Starmer and French President Emmanuel Macron — have since regrouped en masse in an attempt to assemble a “coalition of the willing” to secure the peace. With Trump now halting military aid to Ukraine and related intelligence sharing, time is of the essence.

Europe’s concerted efforts to close ranks on the matter may ultimately bear fruit. But our data on Europeans’ views of Ukraine suggests that assembling such a coalition could be complicated when it comes to securing public buy-in for those efforts, due to a mismatch between some European leaders’ enthusiasm for doing so and lesser enthusiasm among their constituents.

France is a good example of this. Despite Macron’s unwavering support for Ukraine on many fronts, French adults hold net-negative views of Ukraine as of February 2025, as do German and Italian adults. The Brits are meanwhile net-positive on Ukraine, as is the public in several countries that are geographically closer to the conflict, like Norway and Sweden (though not Poland). And somewhat paradoxically, favorability toward Ukraine is meanwhile net-positive in the United States despite the recent antagonism on display between Washington and Kyiv, and despite Americans’ increasing willingness to see Ukraine cede territory to Russia to expedite and end to the conflict (see our assessment here; Republicans are also souring on Zelenskyy himself, per our data, though voters overall hold net favorable views of him).

Both Trump and Zelenskyy (nudged by his European counterparts) appear open to mending fences despite last week’s blowup, potentially bring U.S. public and executive opinion into closer alignment on a deal. While lesser public enthusiasm for Ukraine in some of the Continent’s leading capitals is unlikely to derail a resolution to the conflict, we think it’s worth monitoring as a bellwether of potential constraints on the scope and duration of proposed European peacekeeping forces that are expected to be stationed in Ukraine to support the conflict’s eventual resolution. 

4. Germany (Counter)

Far right? Jein. The German people have spoken. And unlike other recent elections, they didn’t have very much surprising to say, with results largely conforming to pre-election polling. The center-right union of the CDU and CSU came out as the party with the largest vote share at 28.5%, far-right Alternative for Germany (AfD) had a good night — as expected, doubling its vote share compared to the previous general elections — and the members of Scholz’s defunct traffic light coalition (center-left SPD, the Greens, and the FDP) all lost ground. 

But for an election in which voters very clearly shifted right, the country’s Nazi history still makes Germans exceedingly hesitant to self-identify as far right. On a 1-7 scale measuring left-right political ideology, only 3% of German adults claim far-right ideology (per our data here), while 20% of voters chose AfD at the ballot box, a party that ranks 8.8 out of 10 on Parlgov’s scale of European party ideology, and which Germany’s domestic intelligence agency placed under surveillance for suspected extremism. By comparison, 21% of French adults are willing to say their views are on the right-wing extreme of the scale. Furthermore, even voters who told Morning Consult in the leadup to the election that they planned to vote for the AfD generally classified themselves as center right, corresponding to a 5 or 6 on our political ideology scale. Meanwhile, only 15% of self-identified AfD voters said they were on the far right. 

But while very few Germans say they hold far-right or far-left views, their actual opinions on social and economic issues are much more polarized than in France, for example. 

Environmental and social issues will be a particularly tough circle to square. SPD voters are overwhelmingly left of center, and as such are much more likely to value cultural, gender and racial diversity when compared to center-right Germans. They also are much more willing to make tradeoffs to ensure environmental protection. If the Greens join the coalition, that gap will be even more important.

Much of the coverage of Germany’s election has focused on the strong result by the AfD and the threat this could pose in future electoral cycles. While the AfD certainly has an eye on making additional gains, Merz’s CDU voters share many of the AfD’s views on topics like immigration and economic nationalism, leaving an opening for the new government to address many of the grievances that have fueled AfD’s rise. If they can do so and regain public confidence, they may be able to make sure that the historical stigma Germans hold against claiming far-right views is true in fact and not just in theory.