In This Article:
Tesla (TSLA) is now worth less than it was before Donald Trump’s election victory after a plunge in its share price linked to a political backlash against chief executive Elon Musk.
Shares in the electric carmaker fell by more than 13pc on Monday, falling to their lowest level since before November’s US election and knocking more than $110bn (£85bn) off the company’s market value.
Its shares have now more than halved in value since a peak in December. The slump has led Mr Musk’s net worth to fall by more than $105bn.
Tesla shares soared in the wake of Mr Trump’s election victory on optimism that its chief executive’s close support for the US president would lead to Tesla-friendly policies in areas such as autonomous driving.
But the company has faced severe sales drops in many key markets, which analysts have linked to Mr Musk’s links to Mr Trump as well as his praise of Right-wing parties such as Germany’s AfD and Nigel Farage’s Reform.
The company’s cars and charging sites have been subject to frequent acts of vandalism. In response to one video of Tesla Cybertrucks being set alight in Seattle on Sunday, Mr Musk tweeted: “This is crazy”.
Tesla’s share price plunge on Monday came amid a wider sell-off in US markets amid continued concern about the impact of Mr Trump’s tariffs on the economy.
However, the company’s 40pc drop since the start of the year makes it the worst performing stock in the S&P 500 (^GSPC).
Analysts at UBS said on Monday they expected the company to deliver 367,000 cars in the first quarter of the year, down from an earlier forecast of 437,000.
Tesla sales almost halved in Europe in January and fell by 49pc in China in February. It has seen a particularly severe drop in Germany, Europe’s biggest car market, where sales fell 76pc in February.
In addition to the sales decline, investors have raised concerns that Mr Musk’s work on Doge, the Trump administration’s federal cost-cutting effort, could distract from his leadership of the company.
Rival carmakers have sought to capitalise on Mr Musk’s unpopularity among some motorists. Sweden’s Polestar has said that the Tesla boss’s interventions in German politics is an opportunity.
South Korea’s Kia (000270.KS) has taken out adverts in Norwegian newspapers showing its cars with a bumper sticker reading: “I bought this after Elon went crazy”, a twist on the stickers that some Tesla owners have bought distancing themselves from Mr Musk.
Tesla remains by far the world’s most valuable carmaker, worth more than twice as much as Japan’s Toyota (TM). Mr Musk is still significantly richer than the world’s second-richest man, Meta (META) founder Mark Zuckerberg.