Tesla Stock Loses Election Gains Amid Broader Market Concerns

Tesla’s stock fell below pre-election prices following a significant decline of 8%, largely due to concerns about Trump’s economic policies and a negative forecast from UBS on vehicle deliveries. Musk’s net worth decreased significantly as a result, reflecting broader trends in the stock market.

On Monday, Tesla’s stock fell below prices prior to President Donald Trump’s election victory, effectively erasing a 91% gain previously achieved by the electric vehicle manufacturer led by Elon Musk. The stock dropped approximately 8% to $241, reaching its lowest point since November 4, the day before the election.

This decline is part of a broader trend influencing the stock market, particularly impacting the technology-focused Nasdaq Composite, which declined nearly 3% and entered 10% correction territory. Concerns regarding Trump’s economic policies are at the forefront of this downturn.

Directly impacting Tesla shares was a report from UBS analyst Joseph Spak, who projected a 5% decline in Tesla’s vehicle deliveries for 2025, marking a second consecutive year of negative growth, contrary to the consensus expectation of 12% growth this year. The drop starkly contrasts with the enthusiasm that used to accompany predictions of favorable policies under the Trump administration.

Tesla’s stock is now more than 50% lower than its all-time high in December, attributed to the anticipated support from Trump’s policies at that time. Following the drop, Musk’s net worth fell by $12 billion on Monday, reducing his $330 billion fortune by $134 billion compared to his previous high of $464 billion, though he remains the richest individual globally by a substantial margin.

Musk, who contributed $288 million towards Trump’s campaign efforts, has been actively involved in government efficiency initiatives since Trump’s election. The company struggles with tariffs imposed by the Trump administration impacting its operations, especially as it sources parts from multiple countries. There are also reports suggesting a decrease in sales in key markets like China and Europe, compounded by concerns that Musk’s provocative political stance may be harming Tesla’s brand.

Tesla’s stock has experienced a significant reversal, dropping below pre-election values and wiping out substantial gains. Concerns regarding the company’s future growth, influenced by both political and economic factors, have led to a marked decline in share price. Additionally, Musk’s wealth has been significantly impacted, revealing broader implications for both the company and investor sentiment amidst ongoing market adjustments.

Original Source: www.forbes.com