Matt Ott
Tesla’s shares fell 7% on Monday as the feud between CEO Elon Musk and Trump reignited over the weekend.
Musk, a former Trump top donor and ally, announced that he is forming a third party in protest of the Republican spending bill passed late last week. Musk was very critical of the bill, saying he would kill jobs and defeat the fast-growing industry.
In a social media post on Sunday, Trump said the billionaire owners of SpaceX, Tesla and X have been “Rails Off” in recent weeks.
Investors fear that mask companies, which receive big federal subsidies, could suffer even more if their federation continues to fester.
“An autonomous future and AI revolution in full force will ensure Musk/Tesla doesn’t have to keep pushing the bears as Trump will be able to make this political battle awkward in the mid-term in 2026 and create a hurdle for Musk/Tesla/SpaceX in the coming years.”
Tesla stocks have been extremely volatile since Musk all-in for Trump up until last year’s election.
Tesla sales plummeted 13% in the first quarter, then repeated its performance in the second quarter. Industry analysts believe that much of its tail is driven by Musk’s relationship with far-right parties like the German AFD.
Tesla also faces growing global competition, particularly from Chinese automakers such as BYD and the Great Wall. It is rapidly expanding around the world, offering relatively affordable electric vehicles with extremely fast battery charging systems.
Since reaching an all-time high of $479.76 on December 17th, Tesla shares have lost about 40% of its value. Tesla shares fell about $26 since the closing Thursday to $289.75.
Original issue: July 7, 2025, 10:39am EDT
