Advertising expenditure by Tesla on Elon Musk-owned social media platform X plummeted dramatically, and the question is how the auto manufacturer goes about marketing the vehicles considering the slump in auto sales.
The carmaker paid $400,000 for X advertisements in 2024, but recent filings by regulators show a sudden retreat this year. Tesla only paid $10,000 for the first two months in 2025 for X advertisements and will likely pay just $60,000 for the whole year, down a jaw-dropping 85% from the previous year.
The Shifting Advertising Strategy of Tesla
The contrast becomes even more striking when looking at Tesla’s early 2024 spending patterns. By February 2024, the company had already invested $200,000 in X advertising, twenty times more than the same period this year.
Tesla’s advertising momentum slowed considerably after those initial months, with the company spending an additional $200,000 across the remaining ten months of 2024.
This move constitutes a historic departure for Tesla, which traditionally shied clear of mainstream advertising. Tesla established its brand mainly through the word-of-mouth model, media coverage of the ventures by Musk, and the superlative social media following enjoyed by the company’s CEO.
It was only in 2023 that Tesla touched the surface of paid advertising when the shareholders had pressured Musk to seek advertising avenues.
“We’ll do a little bit of advertising and just take a look,” Musk had said during a 2023 earnings call breaking ranks with the company’s long-held anti-ad policy.
Tesla’s first advertisements began appearing on Google search results and YouTube in late 2023 and early 2024, alongside placements on X. While the company’s spending on X appears to be declining, Google’s Ads Transparency database indicates Tesla maintains around 700 active advertisements across Google’s properties, suggesting the company hasn’t abandoned digital marketing entirely.
The slowdown in advertising comes at a tough time for Tesla since the company is experiencing growing competition in the EV segment and worries regarding decelerating growth.
Tesla declined to provide remarks regarding the company’s advertising campaign or if the amount spent on X has grown since last February.
Elon Musk’s Intricate Business Dealings at Tesla
In addition to advertising, Tesla’s filings disclose other intriguing financial transactions by Musk’s business empire. Tesla compensated SpaceX about $800,000 in 2024 for the right to take private flights between the various company headquarters that Musk uses. Even this cost looks destined for cuts since Tesla compensated SpaceX only $40,000 through February 2025.
Musk’s security expenses keep going up, though. Tesla paid during 2024 the amount of $2.8 million to a security firm owned by Musk, while the agreement started at $2.4 million in 2023. Up to February 2025, Tesla had already paid $500,000 for such services, the company saying this only accounts for a part of Musk’s security expenses.
The largest inter-company deal came from xAI, the artificial intelligence company of Musk, when it paid Tesla a sum of $198.3 million in 2024. Almost the entirety paid for Tesla’s Megapack battery storage systems for xAI’s Tennessee data center. The company kept this buying trend going through 2025 when it paid Tesla a further $36.8 million for Megapack items in the first two months alone.
Musk’s other family members were also rewarded for Tesla’s success. Brother Kimbal Musk, who had a seat on Tesla’s board, got paid $300,000 through his company Nova Sky Stories for aerial entertainment at Tesla’s October 2024 event “We, Robot” event.
Now that Tesla faces a growing competitive electric car industry, the sudden decrease in X ad expenditure by the company seems to be a shift in marketing focus. Whether it is a temporary cost-cut measure or a new change in strategy only time will tell, but it shows the intricate finanical dynamics in Musk’s multi-entwined businesses.
