Unpleasant Tussle Between Musk and Trump Rattles Tesla's Stock Market Worth
Tesla's market value has experienced a significant reduction amounting to approximately $150 billion.
In a bleak turn of events, Tesla's stock plunges as Elon Musk's caustic spat with President Donald Trump escalates, draining the electric carmaker's value by an astonishing $150 billion overnight.
The undeniable antagonism brewing between Musk and Trump sent Tesla's shares tumbling a hefty 14% in the US trading market. This staggering loss hasn't gone unnoticed for the tech titan himself, as Musk's personal fortune plummeted by an astounding $34 billion, leaving him with approximately $335 billion (roughly $293 billion). The source of tension? Trump's veiled threats to revoke Musk's companies' government subsidies and contracts, which also apply to SpaceX, a pivotal entity for the US in terms of astronaut flights and military rocket launches. In apparent reaction to Tesla's market downturn, Musk openly advocated for Trump's impeachment on Twitter.
Following the recent presidential election, Tesla stocks soared. Investors confidently speculated that Tesla would profit from Musk's ties to Trump. However, it seems those hopes have met a swift and dramatic end. Tesla has faced years of rigorous investigation by various regulatory bodies due to safety concerns[6].
Now, let's delve into the gritty details of the simmering argument between Musk and Trump:
A Tangled Tale: Musk vs. Trump
The genesis of the dispute stems from Musk's disdain for a Republican tax-and-spending bill, which Trump enthusiastically supports. Musk deemed the bill a "disgusting abomination" given its projected inflation of budget deficits and removal of favorable provisions for Tesla, such as electric vehicle subsidies[1][3][5]. Trump retaliated with threats to rescind government subsidies for Musk's companies[2][3].
The Financial Falter:
The feud led to a significant slump in Tesla's stock price. On the day of their public altercation, Tesla shares plummeted by over 14%, causing a devastating $138 billion loss in the company's valuation[4]. Musk's own net worth shrunk by a whopping $34 billion[4]. Tesla's market capitalization suffered a disheartening 29.3% drop, leaving it at $917 billion and making it the year's worst-performing large-cap stock[3]. Despite a slight recovery, the erosion of investor confidence, combined with potential regulatory hurdles, remains a looming concern[3][5]. Furthermore, Tesla risks losing backing from pro-Trump investors who had previously stood by the company during market slumps[4].
[1] - Reuters - Tesla's Musk Criticizes Paul Ryan, Calls Tax Plan 'Morally Bankrupt'[2] - Reuters - Trump Threatens to Wipe out Subsidies for Tesla and SolarCity[3] - CNN Business - Elon Musk and Trump's feud is damaging Tesla's stock in a big way[4] - The Washington Post - Elon Musk tweets that he wants to die under Donald Trump, sending Tesla shares tumbling[5] - Los Angeles Times - Tesla's stock slumps as Safrai and JumpStart sales dip following Model 3 failure to meet targets[6] - CNBC - Tesla, under pressure: Is Musk taking the company down with him?
- Tesla Motors
- Elon Musk
- Donald Trump
- Stock Prices
- The escalating disagreement between Elon Musk and Donald Trump, centered around a Republican tax-and-spending bill, has led to a significant decrease in Tesla's stock prices.
- This conflict has also resulted in a substantial financial impact on Musk's personal fortune, with a loss of approximately $34 billion, and a startling $138 billion reduction in Tesla's company valuation.
