Tesla shares fell 15.4% to USD 222.15 on Monday, the lowest since October, as investors worried about falling sales and Trump administration trade policy uncertainties. Tesla experienced its largest dip since September 2020.
Tesla shares fell again Monday as investors’ trust in Elon Musk’s electric car company eroded following a post-election “Trump bump”.
Tesla shares fell 15.4 percent to USD 222.15. Tesla shares have fallen to their lowest level since late October, reflecting investors’ increasing pessimism as the automaker’s global sales plummet. Monday’s loss, Tesla’s largest since September 2020, came as Wall Street was experiencing a sell-off due to anxiety over the Trump administration’s trade policy.
Many analysts relate Tesla’s declining stock and auto sales to Musk’s backing for President Donald Trump and other far-right candidates around the world.
Musk contributed USD 270 million to Trump’s campaign ahead of the 2024 election, appeared on stage with him, and cheered his victory over Democratic nominee Kamala Harris in November. Tesla stock skyrocketed to USD 479 a share by mid-December but has subsequently fallen back to earth, losing 40% of its value.
Musk has become the face of the Trump administration’s slash-and-burn government reduction initiatives, known as the Department of Government Efficiency (DOGE). The department has predicted significant layoffs for federal employees and plans to drastically slash government expenditures.
According to analysts, Musk’s conversion to right-wing politics does not appear to appeal to potential Tesla owners, who are often believed to be wealthy, environmentally conscious liberals who have turned to electric vehicles to minimise fossil fuel pollution.
Tesla sales are declining in California, the firm’s largest US market, and the business had its first annual global sales decline last year. Similarly, Tesla sales fell 45 percent in Europe in January, according to research firm Jato Dynamics, while overall electric car sales increased. Sales figures were notably poor in Germany and France.
The most recent vehicle sales numbers from China show that Tesla sales have roughly halved since February of last year, however the fall is due to growing local competition rather than Musk’s politics.
Now, Wall Street experts are concerned about a decline in Tesla deliveries in the United States. UBS Global Research analysts predict deliveries to reduce 5% in the first quarter and full year compared to the same periods in 2024.
“Our UBS Evidence Lab data shows low delivery times for the Model 3 and Model Y (generally within two weeks) in key markets which we believe is indicative of softer demand,” according to them.
Protesters have surrounded Tesla stores in the United States, vandalised its vehicles, put bumper stickers with sayings like, “I bought it before Elon went nuts.”
In addition to supporting Trump, Musk has expressed sympathy for Germany’s far-right, pro-Russian, anti-Muslim party, referred to the British prime minister as an “evil tyrant,” and described Canada, a key Tesla market, as “not a real country.”
Tesla is hardly the only Musk-led company to face difficulties recently. Musk’s X social networking platform collapsed numerous times on Monday, which he attributed to a “massive” cyberattack.
Last Monday, a rocket launched by Musk’s SpaceX exploded and disintegrated over Florida, just two months after another rocket failed.