Elon Musk’s Political Ambitions Rattle Wall Street as Tesla Shares Slide!
Elon Musk’s political involvement was once seen as a strategic asset for Tesla. Now, it’s becoming a source of investor anxiety.
Tesla shares dropped 7% in early trading Monday after Musk floated the idea of launching a new political party in a poll on X, where 80% of respondents voiced support. But Wall Street appears far less enthusiastic.
The decline reflects growing concern over Musk’s increasingly visible role in politics and his escalating public feud with former President Trump. His political moves — including financial backing of Trump’s re-election campaign — once energized Tesla’s stock, contributing to a post-election rally last year.
Today, that same political alignment seems to be working against the company. Tesla’s stock is now down 40% from its December peak, as investors question whether Musk’s focus is drifting too far from Tesla’s core business.
The once-strategic relationship between President Trump and Elon Musk has sharply deteriorated, adding to mounting investor concerns over Tesla’s direction.
Tensions escalated last month when Musk publicly criticized the president’s sweeping policy bill, warning it would balloon the deficit and “bankrupt the nation.” Despite the backlash, Trump signed the bill into law on Friday.
Even before that, Musk’s political ventures had begun to hurt Tesla. His vocal support for Trump’s re-election campaign and endorsements of far-right European politicians have alienated many liberal-leaning consumers — a key demographic for electric vehicles — contributing to sliding sales.
Last week, Tesla reported it delivered 384,000 vehicles in Q2, a 14% drop compared to the same period last year.
Hopes for a reconciliation between Musk and Trump faded further on Sunday, when the president slammed Musk on Truth Social, calling him a “train wreck” who had gone “off the rails” with his proposal for a new “America Party.”
Musk reposted Trump’s remarks on X — the platform he owns — without offering a response.