Tesla Shares Surge as Musk Shifts Focus Away from Government Role

Tesla shares rose by 5% after Elon Musk announced he would spend less time on his government work, sparking hopes that he'd concentrate on rebuilding Tesla's brand. Despite criticisms over government-related job cuts, the decision aims to restore investor confidence and focus on reversing declining sales.

Tesla shares spiked by approximately 5% in premarket trading on Wednesday following Elon Musk's announcement to reduce his governmental duties, instilling optimism among investors that the CEO would refocus on Tesla's brand and sales performance.

Musk's involvement in the Department of Government Efficiency (DOGE) generated significant backlash due to proposed federal job cuts, resulting in protests and damage to Tesla facilities. Despite acknowledging the controversy, Musk remained unconvinced that these issues were responsible for a significant drop in Tesla's sales and profits.

By limiting his work with President Donald Trump's administration, Musk aims to devote more attention to the electric vehicle maker, especially considering a near 50% drop in Tesla's stock price since December. Investors are hopeful this realignment will stabilize Tesla's brand and address declining sales.

(With inputs from agencies.)