Elon Musk’s Departure from DOGE
Elon Musk’s decision to step back from the Department of Government Efficiency (DOGE) and refocus on his companies—Tesla, SpaceX, Neuralink, and xAI—marks a pivotal moment in his multifaceted career. After spearheading DOGE under the Trump administration, Musk’s exit reflects a strategic shift prompted by challenges within his business empire and the controversies surrounding his political involvement.
What is DOGE?
The Department of Government Efficiency, abbreviated as DOGE, was an ambitious initiative launched during the Trump administration to streamline federal operations and slash government spending. Led by Elon Musk, who served as an unpaid special government employee, DOGE aimed to eliminate waste, fraud, and inefficiencies across federal agencies. Musk’s appointment brought his signature bold approach to the role, symbolized by his dramatic appearance at a Conservative Political Action Conference wielding a chainsaw to underscore his intent to cut bureaucracy aggressively.
DOGE’s initial target was to save $2 trillion, a figure that was later scaled back to $1 trillion and eventually to $150 billion—less than a tenth of the original goal. The initiative’s implementation was marked by rapid, often chaotic cuts, resulting in the termination of tens of thousands of federal employees. This sparked protests, lawsuits, and widespread criticism, with detractors arguing that the approach sacrificed long-term stability for short-term savings. Musk claimed DOGE had saved $160 billion by the time of his departure, though this figure remains disputed.
Why is Musk Leaving DOGE?
Musk’s exit from DOGE is primarily driven by mounting pressures within his business portfolio, particularly at Tesla, which has experienced significant financial and reputational setbacks. In an April 2025 Tesla earnings call, Musk announced that his involvement in DOGE would “drop significantly” starting in May, as he shifted his focus back to Tesla. The company reported a staggering 71% drop in profits for the first quarter of 2025, alongside a 50% decline in its stock price since December 2024. These challenges underscored the need for Musk to prioritize Tesla’s recovery over his political endeavors.
Beyond financial woes, Musk’s association with DOGE has damaged the public perception of his companies. Tesla and SpaceX, once celebrated as innovation powerhouses, saw their rankings plummet in the 2025 Axios Harris 100 poll, with Tesla dropping to 95th and SpaceX to 86th. This decline was linked to Musk’s polarizing role in DOGE, which alienated segments of consumers and investors. Protests against Tesla escalated, with reports of cars being vandalized or burned, reflecting public discontent with Musk’s political activities. In an interview, Musk admitted, “Being attacked relentlessly is not super fun. Seeing cars burning is not fun,” signaling that the personal and corporate toll had become unsustainable.
The Impact of Musk’s Departure on DOGE
Musk’s reduced role does not spell the end for DOGE. Executives from his companies, including Tesla, SpaceX, The Boring Company, and xAI, remain embedded in key positions within the initiative, ensuring his influence persists. For instance, Antonio Gracias, a SpaceX director and Musk confidant, has been involved in efforts to address fraud at the Social Security Administration. This continuity suggests that DOGE will maintain its trajectory, albeit without Musk’s high-profile leadership.
However, questions linger about DOGE’s future efficacy. Critics argue that the initiative’s aggressive cuts, while yielding some savings, have introduced significant costs. A federal workforce expert estimated that the rushed and disorganized approach could cost taxpayers $135 billion in fiscal year 2025 due to disruptions and inefficiencies. With Musk no longer at the helm, and given DOGE’s failure to meet its lofty initial targets, the initiative may struggle to maintain momentum and credibility.
Reaction to Musk’s Departure
The response to Musk’s exit from DOGE has been polarized. Within the Trump administration and among Republican supporters, Musk’s efforts have been lauded. President Trump publicly thanked Musk during a cabinet meeting, humorously noting that Musk had been “wearing a lot of hats.” Some view his tenure as a bold, if imperfect, attempt to reform government inefficiency.
Conversely, federal employees and Tesla stakeholders have expressed relief and frustration. Federal workers, battered by DOGE’s cuts, have protested vehemently, with figures like former UN lawyer Cheatham accusing Musk of baseless attacks on their roles. Tesla investors, meanwhile, have criticized Musk’s divided attention as a contributor to the company’s woes, though some see his departure from DOGE as a positive step. On X, opinions vary: one user hailed it as a “huge step forward” for Tesla’s focus on autonomous driving, while others lamented the perceived abandonment of DOGE’s mission.
What This Means for Musk’s Companies
Musk’s return to his companies comes at a critical juncture. Tesla, in particular, faces steep challenges: sales in Europe have dropped nearly 50% amid backlash to Musk’s politics, and its brand reputation has taken a hit. Yet, Musk’s renewed commitment—highlighted by his promise during an earnings call to allocate “far more of my time to Tesla”—offers hope for stabilization. Investors responded positively to this assurance, signaling confidence in Musk’s ability to steer Tesla back to growth, potentially through advancements in autonomous driving and energy solutions.
Elsewhere, SpaceX remains a bright spot, securing NASA contracts and exploring a Starlink deal to modernize air traffic control. xAI, Musk’s AI venture, has also gained traction, acquiring X (formerly Twitter) for $33 billion and advancing its Grok AI system. However, xAI’s government ties have sparked concerns about conflicts of interest, particularly regarding access to federal data—a scrutiny Musk may need to navigate as he reasserts control over his empire.