Tesla falls for six consecutive trading days... Impact of Musk-Trump conflict
In recent trading sessions, Tesla's stock has plummeted, marking a streak of six consecutive days of losses. Analysts have pointed to the ongoing discord between Tesla's CEO, Elon Musk, and former U.S. President Donald Trump as a significant factor contributing to this downward trend.
On the first day of the month, as per local trading hours at the New York Stock Exchange, Tesla's shares ended the session at a lower price compared to the previous day. Specifically, the stock decreased by 5.34%, settling at $300.71. This decline, which began on the 23rd of the preceding month, has persisted uninterrupted for six trading days in a row.
The continual drop in Tesla’s stock price has brought it perilously close to falling below the $300 mark, threatening a level not seen since it recorded $295.14 on the sixth of the previous month. As a result, the company's market valuation has dipped below the trillion-dollar threshold, standing at $968.6 billion.
A significant element fueling the stock slump is the mounting tension between Musk and Trump. Musk has openly condemned a legislative proposal backed by Trump. This proposal, which seeks to dismantle eco-friendly initiatives and introduce sweeping tax reductions, has been denounced by Musk as an "insane spending bill."
In retaliation, Trump took to his social media platform, 'Truth Social,' to assert that the financial assistance provided to Musk's enterprises from the government should be scaled back. He further alluded to the possibility of cutting government contracts, suggesting that the Department of Government Efficiency (DOGE) might need to intervene with Elon’s operations.
Musk, who once spearheaded expenditure reductions and organizational restructuring as the head of the Department of Government Efficiency during Trump’s second term, had voiced his skepticism regarding Trump’s policies soon after concluding his special public service tenure.
Industry experts caution that if the Musk-Trump dispute escalates beyond public spats to tangible actions such as subsidy cuts or contract re-evaluations, it could have a direct adverse impact on Tesla’s prospects for growth and future profitability.