We examine the extent to which a brand’s ideological activity influences consumer willingness-to-pay (WTP) for an environmental good and, consequently, private and social welfare. Using Texas vehicle registrations, we estimate that WTP for the Tesla brand falls by $17,000 among Democrat ZIPs and $12,000 among moderate ZIPs from 2021Q1 through 2025Q1. We show that the steepest falls in WTP for Teslas correspond to CEO Elon Musk’s Republican political involvement. Moderate WTP for Teslas falls during the 2024 election and Democrat WTP falls during both Musk’s 2022 Twitter acquisition and the 2024 election. We estimate that Musk’s 2024 election involvement led Tesla revenues to fall $1.3 billion per year in the U.S.A. Democrat and moderate consumers substituted primarily to gas vehicles, leading annual damages from vehicular carbon emissions to rise by $86 million and consumer surplus to fall by $366 million per year. Our findings highlight that ideology drives consumption of environmental goods, often to the detriment of consumer and social welfare.
