Tesla stock plummets as shares dropped 15% on Monday, closing at $222, the lowest level since October 2023. The electric vehicle giant, led by Elon Musk, has now lost all gains made since Donald Trump’s November election victory.
This latest decline marks Tesla’s worst percentage drop since 2020, ranking as the 7th-worst trading day in the company’s history. Analysts warn that weakening demand and broader market fears are driving the downturn.
What’s Behind Tesla’s Stock Decline?
Tesla’s sharp drop came amid a broader stock market sell-off, fueled by concerns over Trump’s economic policies. The tech-heavy Nasdaq Composite fell 4%, officially entering correction territory with a 10% decline.
Adding to the pressure, UBS analyst Joseph Spak issued a warning about Tesla’s performance, forecasting a 5% decline in vehicle deliveries for 2025. If correct, this would mark the second straight year of negative growth for the company, contrasting sharply with Wall Street expectations of 12% growth.
The result? Tesla stock plummets, extending its losses to 53% below its December all-time high.
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Tesla Market Value and Musk’s Wealth Take a Major Hit
Tesla’s stock drop isn’t just impacting investors—it’s also dealing a heavy blow to Elon Musk’s net worth. The billionaire lost $23 billion on Monday alone, bringing his total wealth down to $319.6 billion, far below his December peak of $464 billion.
Since Election Day, Tesla stock plummets by 12%, with its total market capitalization shrinking by nearly $800 billion from its previous high.
Political and Economic Challenges Weigh on Tesla
Beyond market trends, Tesla is facing challenges directly tied to Trump’s policies. Musk, who donated $288 million to Trump’s campaign and Republican causes, now heads the Department of Government Efficiency (DOGE), a commission focused on cutting government costs.
Meanwhile, Tesla remains heavily exposed to Trump’s tariffs, as China is its second-largest market, and the company depends on imported parts from Canada, China, and Mexico. Reports of slowing sales in China and Europe further add to investor concerns, with some analysts warning that Musk’s political stances may be damaging Tesla’s brand reputation.
As Tesla stock plummets, the road ahead remains uncertain. With declining demand and shifting political landscapes, investors will be watching closely for Musk’s next moves.
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