Tesla’s futuristic Cybertruck is nowhere near as popular as Elon Musk expected, and now the company is scrambling to offload thousands of units. It appears that Musk’s bond with US President Donald Trump and his role as an advisor has facilitated an opportunity to solve a major inventory problem after several quarters of poor Cybertruck sales.
The arrangement will see hundreds of millions of Fed funds moved to Tesla, a move that many citizens are questioning considering Musk’s role in government as head of the Department of Government Efficiency.
Tesla Cybertruck sales are a disappointment and inventory needs to be offloaded
In 2024, the same year that the model was launched, Tesla had a million reservations for Cybertrucks on its books. This sounds like an incredible figure until looking at how many of these translated into actual sales. CEO Elon Musk set a sales target of 500,000 Cybertruck units per year, but fewer than 40,000 made it off the showroom floors in the United States last year.
This figure was enough to make the Cybertruck the bestselling pickup in the US, but considering how few people buy electric pickups, it’s no great feat. By comparison, regular pickup sales were in the millions, so 40,000 Cybertrucks is barely worth mentioning.
Elon Musk even went as far as donating a fleet of Cybertrucks to aid in the LA fire-fighting efforts in January, a clear sign that they’re standing around waiting for buyers.
The falling sales trend is unlikely to recover
Cybertruck sales figures for the last quarter of 2024 dropped 22% from the previous quarter, indicating that momentum didn’t pick up later in the year. Tesla recently promised that sales would “return to growth” after last year’s disappointing showing, but they aren’t looking any better so far in 2025 as global figures continue to fall, a trend that’s likely to be sustained.
Trump has offered Musk a sweet solution to the Cybertruck surplus
Billionaires Elon Musk and Donald Trump have been allies for some time now, and Musk now serves the Fed in an advisory role and contributes to policy discussions. His position appears to have opened a door to a deal to sell a massive fleet of Cybertrucks to the US government. According to State documents, $400 million worth of “armored electric vehicles” (which was amended from “armored Tesla vehicles”) are set to be procured for federal deployment.
The Tesla model is not specified in the State document, but the Cybertruck with its high-strength stainless steel body seems by far the most likely choice.
$400 million means 4,000 Cybertrucks
Let’s look at the math. A standard Tesla is $80,000, but these would need to be fitted with armoring and other add-ons, so the cost can be estimated at $100,000 each. This means that Tesla can shift 4,000 units to Trump’s administration, a figure equal to 10% of last year’s total US sales, a lucrative contract indeed for Musk, whose companies have secured upwards of $13 billion in federal contracts over the past five years.
Some see government’s procurement of Teslas as a conflict of interest
The news about the Fed’s plan to spend hundreds of millions on armored Teslas was released in the State Department’s procurement forecast for 2025. Cybertrucks are an atypical choice for government armored transport. The usual models include the Cadillac One and Escalade, and the Chevrolet Suburban.
The move has sparked grumbling about the conflict of interest, especially seeing as Musk is known for lauding his own efforts to curb unnecessary government spending. Musk contributed more than $250 million to Trump’s successful election efforts, and now he’s the head of the Department of Government Efficiency.
Musk has portrayed the federal government as riddled with waste and corruption when posting on social media. He recently posted about overpriced coffee cups and soap dispensers at the Pentagon.
It’s no surprise that some Americans are questioning the $400 million deal when it’s contrary to the point of Elon Musk’s position. Aside from the exorbitant cost, a question of quality has also been raised as Cybertrucks are known for being frequently recalled and sometimes floored by minor conditions such as a few inches of snow.