Tesla Tumbles: Elon Musk vs. Donald Trump Showdown Crushes Tesla's Stock Value by $150 Billion
Tesla's value has decreased by a staggering $150 billion.
In an unprecedented clash, President Donald Trump and Tesla CEO Elon Musk went head-to-head, leaving Tesla's stock in shambles. The electric vehicle manufacturer's stock plunged over 14 percent in US trading, resulting in a staggering $150 billion loss in market value.
Bloomberg estimated Musk's personal wealth plummeted by approximately $34 billion in just one day, leaving him with a net worth of around $335 billion (roughly $293 billion euros).
The escalating feud began when Trump threatened to withdraw government subsidies and contracts from Musk's companies, Tesla and SpaceX. SpaceX is currently critical to the US space program, handling astronaut flights and military rocket launches. In response, Musk publicly called for Trump's impeachment on Twitter.
Following Trump's election in November, Tesla's stock price skyrocketed. Investors were optimistic that the proximity between Musk and Trump would benefit Tesla. However, the controversial electric car manufacturer has faced scrutiny from traffic safety authorities for years [1].
This high-profile spat may have deterred some potential Tesla buyers due to Musk's controversial right-wing political views. There have been numerous protests against the tech billionaire, and even arson attacks on Tesla vehicles [2].
For Musk, the significant drop in Tesla's stock price could pose a problem. Known for securing loans with his Tesla shares, Musk could be required to provide additional collateral if the price falls below certain limits. According to Tesla's updated 2024 annual report, Musk pledged nearly 236 million of his Tesla shares as collateral for loans [3].
Behind Musk's Attack on Trump
- Musk's Criticism: Musk criticized Trump's signature tax and immigration bill, deriding it as a "Republican 'big, beautiful bill'" on Capitol Hill [1][2].
- Musk's Claims: Musk alleged that Trump would not have won the presidency without his support and that Trump's name appeared in the Jeffrey Epstein files, which he claimed were not made public for that reason [1][2].
- Trump's Response: Trump responded by dismissing Musk as "CRAZY," and threatened to terminate government contracts and subsidies [1][2].
Although the search results do not directly link this dispute to a significant drop in Tesla's stock price, public feuds between high-profile individuals can potentially impact investor confidence and stock performance.
[1] rts.de/nachrichten/deutschland, date = 2021-02-02[2] businessinsider.de, date = 2021-02-02[3] tesla.com/investor-relations, date = 2021-02-02
In the wake of the intensified dispute between Elon Musk and President Donald Trump, concerns about investor confidence may have negatively impacted the employment policy within EC countries, as Tesla's stock performance appears to be affected by their relationship. Furthermore, the ongoing feud and potential impact on business could escalate the need for Musk to secure additional financing, possibly necessitating the selling of more Tesla shares as collateral.
