Tesla’s electric dreams are fading fast as sales plummet and shares tank. Despite Elon Musk’s high-profile endorsement of President Trump, his involvement in politics is seen as a distraction from driving innovation at the company.
Musk has taken on a prominent role in Trump’s new administration as leader of the Department of Government Efficiency (DOGE), but this move has raised concerns among investors about long-term profitability. Tesla shares have plummeted by 15 percent, their worst day since 2020, and are now trading at around $235.
The main reason for the decline is increased competition from traditional automakers and new electric vehicle producers. Tesla’s failure to deliver innovations in self-driving technology and robotics has also weighed on investor sentiment. Musk’s expanding portfolio of businesses, including his Twitter acquisition, is also taking a toll on his ability to effectively lead the company.
Trump’s trade policies, particularly his opposition to subsidies for electric vehicle producers and emissions regulations, could further weaken demand for Teslas. The continuing trade war with China could disrupt Tesla’s supply chain and reduce its competitiveness in a crucial market.
As Musk’s personal wealth is closely tied to Tesla’s stock price, his political activities have caused anger among some investors, culminating in protests and arson attacks at Tesla dealerships. Experts warn that this could lead to a recession hitting highly leveraged stocks like Tesla particularly hard.
With the economy teetering on the brink of recession, it remains to be seen how Musk will balance his duties as CEO with his growing role in Trump’s administration. One thing is certain, however – Tesla’s electric dreams are fading fast.
Source: https://www.aljazeera.com/news/2025/3/14/musks-never-been-more-powerful-so-why-are-tesla-shares-tanking