Elon Musk has said the time he spends with Donald Trump’s Department of Government Efficiency (DOGE) will “drop significantly” from May and he will allocate more time to Tesla.

It comes after first-quarter profits at Tesla sank as the company grapples with falling sales, partly due to President Trump’s tariffs.

As a special government employee, Mr Musk was limited to 130 days in his role at DOGE, which is primarily aimed at slashing federal spending.

But the cuts, which included axing government jobs, have divided the country and prompted a backlash against his company, including protests and attacks on Tesla showrooms, prompting Donald Trump to label the vandals “terrorists”.

Tesla said on Tuesday that quarterly profits fell by 71% to $409m (£306.77m) from $1.39bn (£1.04bn) in the first quarter of 2024. Revenues were also well below forecasts, dropping 9% to $19.3bn (£14.5bn) between January and March.

The company’s value has plummeted since reaching a record high in mid-December. Since then, Tesla’s share price has fallen more than 50%.

Tesla’s share price has tumbled following the financial market turbulence caused by the global trade war tariffs, competition from Chinese EV rivals and concern over Mr Musk’s ability to give the firm the attention it requires.

Mr Musk’s role as chief executive of the company was among the most common questions shareholders were asking about in a question-and-answer portal ahead of an investor call on Tuesday evening.

As well as his role at the top of Tesla, he is also the CEO of space exploration company SpaceX and owns social media company X, formerly known as Twitter.

Musk has ‘lost focus’

An early Tesla investor Ross Gerber said in a recent interview with Sky’s Business Live that Mr Musk had lost his focus and was now too “divisive”.

There has been no clear sign of improvement at Tesla as much-awaited updates on making affordable cars and developing driverless technology left some questions unanswered.

Work on an affordable car remained “on track for start of production in the first half of 2025”, Tesla’s financial results said, but no details on a prototype were given.

Production of Tesla’s self-driving robotaxi, named Cybercab, is scheduled to start in 2026.

Tariffs harming outlook

Uncertainty was also evident in the outlook statement, which pointed to the harm tariffs could pose to the business.

“It is difficult to measure the impacts of shifting global trade policy on the automotive and energy supply chains, our cost structure and demand for durable goods and related services,”

“The rate of growth this year will depend on a variety of factors, including the rate of acceleration of our autonomy efforts, production ramp at our factories and the broader macroeconomic environment”.

While Teslas are made in the US, there are also factories in China and Germany. Under the tariff regime, those car parts are subject to additional taxes when they enter America.

The new owner of WH Smith’s high street arm is drawing up plans which could result in the closure of nearly a quarter of the stores operated by Hobbycraft, the arts and crafts chain.

Sky News has learnt that Modella Capital, a private investment firm which specialises in taking over troubled retailers, is preparing to launch a company voluntary arrangement (CVA) at Hobbycraft as soon as Wednesday.

People close to the proposals said that nine of its shops would be closed, with the loss of roughly 100 jobs, and that 18 more would remain open only if negotiations with landlords over rent cuts concluded successfully.

A further 97 stores will remain unaffected by the CVA, the people added, protecting 1,800 jobs.

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If the talks with landlords do not progress as envisaged and the 18 affected stores are also earmarked for closure, at least 150 more redundancies could be triggered based on Hobbycraft’s average number of employees per store.

Some job losses are also expected at the company’s head office and distribution operations, according to insiders.

The Hobbycraft CVA is expected to be launched shortly before Modella also pursues a restructuring at The Original Factory Shop (TOFS), the discount chain it acquired just two months ago.

One industry source speculated that as many as between 30 and 40 TOFS outlets could close, resulting in hundreds more layoffs.

The dual restructuring processes will raise questions about whether Modella plans a similar cull of shops and workers at WH Smith, which it has said will be renamed TG Jones following the takeover.

In a statement, a Modella spokesman said: “Modella Capital is absolutely committed to bricks and mortar retail, at a time when the sector is coming under increasing pressure.

“[Modella] understands that high streets provide a vital service to consumers, are an essential source of employment and are key to the future success of local economies.

“Modella Capital believes that many retailers can thrive on the high street; particularly those with a distinctive offer and a loyal customer base.

“Where necessary, Modella Capital has the skills and experience to restructure retailers that require it, in order to ensure they create profitable, ongoing businesses that will continue to serve communities and employ thousands of people across the UK.”

FRP, the professional services firm, is overseeing the Hobbycraft CVA, while Interpath Advisory is working on the equivalent process at TOFS.

CVAs – a widely used tool in the retail and hospitality sectors in recent years – are frequently utilised to facilitate store closures and rent cuts from landlords.

Modella bought Hobbycraft, which was founded in 1995, from the private equity firm Bridgepoint last summer.

Rachel Reeves will pledge to “stand up for Britain’s national interest” as she heads to Washington DC amid hopes of a UK/US trade deal.

The chancellor will fly to the US capital for her spring meetings of the International Monetary Fund (IMF), the first of which began on Sunday.

During her three-day visit, Ms Reeves is set to hold meetings with G7, G20 and IMF counterparts about the changing global economy and is expected to make the case for open trade.

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Her visit comes after Donald Trump imposed blanket 10% tariffs on all imports into the US, including from the UK, and as talks about reaching a trade deal intensified.

The chancellor will also hold her first in-person meeting with her US counterpart, treasury secretary Scott Bessent, about striking a new trade agreement, which the UK hopes will take the sting out of Mr Trump’s tariffs.

In addition to the 10% levy on all goods imported to America from the UK, Mr Trump enacted a 25% levy on car imports.

Ms Reeves will also be hoping to encourage fellow European finance ministers to increase their defence spending and discuss the best ways to support Ukraine in its war against Russia.

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Speaking ahead of her visit, Ms Reeves said: “The world has changed, and we are in a new era of global trade. I am in no doubt that the imposition of tariffs will have a profound impact on the global economy and the economy at home.

“This changing world is unsettling for families who are worried about the cost of living and businesses concerned about what tariffs will mean for them. But our task as a government is not to be knocked off course or to take rash action which risks undermining people’s security.

“Instead, we must rise to meet the moment and I will always act to defend British interests as part of our plan for change.

“We need a world economy that provides stability and fairness for businesses wanting to invest and trade, more trade and global partnerships between nations with shared interests, and security for working people who want to get on with their lives.”