Why Tesla Shares Slid By 14%
Thursday was a turning point for Tesla (TSLA) Shares lost 14% of its value when CEO Elon Musk took his words against the President one step further. In mid-day trade, Trump expressed disappointment at Musk’s disapproval of his bill.
TSLA stock sold off when the President contemplated ending government contracts tied to companies owned by Musk.
The exchange of words comes at a bad time for Tesla. The firm has not yet launched its robotaxi service in U.S. markets. It does not have a full self-driving software solution for customers, either.
The chances are high that the government will continue to wind down electric vehicle subsidies. Without tax credits, consumers are unlikely to buy an EV. This hurts Tesla, Lucid Motor (LCID), and Rivian Automotive (RIVN). Fortunately, firms like General Motors (GM) and Ford Motor (F) cut back on their EV ambitions. Those two firms, along with Toyota (TM), will benefit from higher hybrid vehicle sales.
After markets closed, Trump Media & Technology (TMT) announced a stock sale worth $20 billion. DJT stock fell by 8.04% ahead of the news.
Tesla shares closed at $284.70, erasing a rally that started early last month. Should Musk and Trump continue to exchange words online, TSLA stock could re-test the 52-week low of $167.41.
