Tesla’s stock price has taken a significant hit, falling nearly 31% since its peak in December. The company’s disappointing earnings and declining sales have raised concerns about its growth potential. Despite the recent poor performance, Tesla’s share price is still up more than 30% compared to its value before Trump’s election victory.
The decline in Tesla’s stock price is attributed to several factors, including the launch of new models, such as the Model Y, and Musk’s increasing political activism. Some analysts believe that the new model may be causing customers to delay their purchases, while others point to the reputational damage caused by Musk’s support for far-right politicians.
Musk’s growing involvement in politics has also led to a backlash against him on social media, with many users migrating from his platform X to Bluesky. In the automotive industry, this could manifest in customers choosing rival brands instead.
The automotive industry is also facing challenges due to Trump’s trade policy, which has imposed tariffs on aluminum, steel, and China. Tesla’s sales in China have dropped by 11.5% in January compared to the previous year, and the company faces intense competition from BYD in the Asian market.
Despite these challenges, Musk remains undeterred, pursuing an offer of nearly $100 billion to acquire OpenAI, the owner of ChatGPT, from his longtime rival Sam Altman. However, it’s unclear whether this move will help Tesla recover from its current struggles.
The “Trump effect” may continue to impact Tesla’s stock price if the autonomous car division fails to meet expectations. Investors who jumped on the bandwagon more recently may be particularly affected by this trend.
Source: https://english.elpais.com/economy-and-business/2025-02-12/the-trump-effect-no-longer-boosts-tesla-stock-drops-by-nearly-a-third-since-peak.html