Tesla stock has dropped significantly, trading lower than before Trump’s election victory and erasing a 91% gain. The decline, attributed to concerns about Trump’s economic policies and a negative delivery forecast, aligns with general market losses. Elon Musk’s net worth has also fallen dramatically as Toyota faces sales challenges, especially in China and Europe.
Tesla stock has experienced a significant decline, now trading lower than its price prior to President Donald Trump’s November election victory. Once boasting a 91% gain, shares of the electric vehicle manufacturer, led by Elon Musk, dropped about 8% to $241, marking the lowest price since November 4, the day before the election. This decline reflects the ongoing downward trend in the stock market, as concerns about Trump’s economic policies mount.
The recent drop in Tesla shares aligns with a broader market downturn, exemplified by the Nasdaq Composite’s nearly 3% decrease, indicating a correction of 10%. Analyst Joseph Spak of UBS contributed to the decline by forecasting a 5% decrease in Tesla’s vehicle deliveries for 2025, which would represent consecutive years of negative growth contrary to analyst predictions of 12% growth for this year.
Tesla shares are now over 50% lower than their peak in December, a time when investors were optimistic about the impact of pro-business policies from the Trump administration. Elon Musk’s net worth has also significantly decreased, dropping $134 billion from its record high of $464 billion in December, following a $12 billion loss due to the recent stock slide.
Musk has played a notable role in political donations, contributing $288 million towards Trump and Republican efforts. His influence is further emphasized by his recent appointment as head of the Department of Government Efficiency (DOGE), a commission set up to oversee cost reductions and layoffs. The company’s dependence on parts from Canada, China, and Mexico places Tesla directly in the crosshairs of Trump’s tariffs, further complicating its market position, particularly in China and Europe, where sales to begin 2025 appear dismal. Analysts caution that Musk’s political statements might be negatively impacting Tesla’s brand reputation.
In summary, Tesla stock has retraced to levels lower than before the 2020 election, erasing substantial prior gains fueled by pro-business sentiment. The company’s downward trajectory is coupled with broader market concerns regarding economic policies influenced by the Trump administration. With forecasts indicating potential declines in vehicle deliveries and the political overshadowing of Musk’s brand, Tesla faces significant challenges ahead. Musk’s financial stature continues to diminish, reflecting the intertwined nature of his wealth, the stock’s performance, and market sentiment.
Original Source: www.forbes.com
