Following a public spat between CEO Elon Musk and former US President Donald Trump, Tesla’s stock price fell more than 5% on Monday. Musk’s public criticism of Trump’s proposed business regulation bill and his support for the creation of a new political party raised investor concerns about possible political and market instability, which led to the fall.
The precipitous drop in Tesla stock destroyed billions of dollars in market value and rocked Wall Street, where Musk’s political remarks have previously led to erratic trading patterns. At a time when Tesla is looking for additional U.S. government incentives for electric vehicles, market watchers warn that the issue might polarise conservative investors and federal officials.
Elon Musk expressed his displeasure on the social media site X (previously Twitter), saying that Trump’s planned legislation “punishes innovation” and is an example of “crony capitalism at its worst.” Additionally, he alluded to the necessity of a centrist party that upholds free-market ideas impartially, a remark widely interpreted as a direct challenge to both Democrats and Republicans.
According to political commentators, the dispute may prove to be a turning point in the history of the relationship between the political elite and tech firms. Tesla has not yet made an official remark about the scandal, but at the next quarterly earnings call, the firm is anticipated to address shareholder concerns.
