The Elon Musk-led Department of Government Efficiency, otherwise known as DOGE, is seeking to cut inefficiency in the U.S. government. But maybe Musk could start with a target closer to home: his own Tesla (TSLA).
↑ X NOW PLAYING This Is What Warren Buffett Looks For In Winning Stocks – And Why Tesla Didn't Make The CutTesla, a leading maker of electric vehicles, is one of the most bloated S&P 500 companies based on an often used measure of productivity: revenue per employee. Each Tesla employee hauled in $777,384 in revenue in the past 12 months, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSurge. That's well below the $1.5 million pulled in by S&P 500 employees on average.
Such statistics raise questions about Tesla CEO Elon Musk's ability to control costs at his own company — much less government agencies he didn't have a hand in creating. And that's not to mention the potential distraction of running DOGE while Tesla shareholders watch shares fall.
"The worry of the Street is that Musk dedicating so much time (even more than we expected) to DOGE takes away from his time at Tesla in such a crucial moment and year for the company," said Wedbush analyst Dan Ives in mid-February.
Don't blame the bloat at Tesla on the labor-intensive nature of automaking. Tesla's productivity falls short of both of its domestic carmaking rivals. Revenue per employee is much higher at both General Motors (GM) and Ford (F).
Each GM employee hauled in $1.16 million in the past 12 months, or nearly 49% more than Tesla employees did. Meanwhile, Ford employees represented $1.08 million each, or 39% more than Tesla. Tesla would either need to cut a third of its workforce or boost revenue by nearly 50% with the same number of employees to match GM's productivity.
And Tesla is nowhere near being a role model by this measure in the S&P 500 either. Its revenue per employee is far below the S&P 500's productivity champ, VICI Properties (VICI). The real estate firm's employees represent revenue of $142.6 million each on average.
Tesla's numbers don't look much better vs. the S&P 500 sectors, either. Tesla's revenue per employee is below average in six of the 11 S&P 500 sectors. And it's only 28% better than the average $604,804 revenue per employee in the consumer discretionary sector, in which it belongs.
The problem for Tesla shareholder is that the more involved Musk gets with DOGE, the more the stock falls.
Shares of Tesla are down more than 35% this year, much worse than the 11.4% drop at GM and 2.7% fall at Ford. Tesla shares are now nearly 47% below their 52-week high. GM is only off 22.9% and Ford 35.1%.
Tesla stock in late February and early March broke below potential floors at the 325-360 price range, and then the 300 level. It is now fighting to hold the 200-day line, around 279 — a crucial level of technical support.
Tesla investors might hope Musk focuses on them again — and less on DOGE — so they can see more efficiency with their capital.
| Company | Ticker | Revenue last 12 months (billions) | Employees | Revenue per employee |
|---|---|---|---|---|
| General Motors | GM | $187.4 | 162,000 | $1,157,049 |
| Ford Motor | F | $184.99 | 171,000 | $1,081,825 |
| Tesla | TSLA | $97.7 | 125,665 | $777,384 |
| S&P 500 | $1,571,601 |
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