The “Brahmons” between the United States President Donald Trump and Tech billionaire Elon Musk was on a complete performance on Tuesday when the White House South Lawn was converted into a short Tesla showroom.
Musk paved Tesla cars to show the latest innovations of the electric car manufacturer, while Trump promised to make anyone “domestic terrorist” after reports of barbarity and arson attacks on Tesla cars across the country.
Known for his strong stance on domestic manufacturing and trade leadership, Trump has given a major role in his new administration as the leader of the new department of government’s efficiency (DOGE), claiming that “billions and billions of dollars of garbage, fraud and abuse” have been claimed in the US federal government that the US federal government has claimed to have been highlighted – for which the significant evidence is yet to be seen for which musc and trump.
Meanwhile, Tesla’s shares, which are listed on the Nasdaq, are flounding. On Monday this week, they fell to 15 percent to finish the day at $ 215 – since 2020, Trump won the presidential election in November since 2020 and its lowest level. Before exiting approximately $ 235 by the end of the day, the shares after Tuesday’s President’s plug for Tesla cars raised the plug back on Tuesday’s President’s plug for Tesla cars. On Friday, the stocks opened around $ 240.
The Tesla Stock has been in the freefall since the major high levels of over $ 435 in mid -December, 2024. So why is the car manufacturer spoiling when its owner appears to be flying high in the White House?
Why is Tesla’s share price falling?
Despite performing well after the November presidential election in the US, Tesla’s stock was unstable during a total of 2024 and has declined rapidly since the beginning of this year. Robert Scott, an expert at the International Economics and Business Policy at the US -based Economic Policy Institute, said that the decline in the share price was unavoidable due to its “extreme overwell”.
Scott told Al Jazeera, “Tesla’s stock was highly overwelled, one of the highest value-to-Kamai ratio,” Scott told Al Jazira. This means that the price of stock was much higher than the profit generated by the company. “This indicates that the stock price was inflated relative to the basic principles of the market.”
William Lee, the chief economist at the Milken Institute, said the decline in the share has resulted in the delay in the launch of the new Tesla products.
“The new refresh for the Tesla model Y is on, and more importantly that no new model has been introduced,” Lee said.
What has happened to the sale of Tesla vehicles?
There has been a decrease in sales in Europe and other places. According to Business Insider data, the business trade news outlet in February was 76 percent lower in Germany, while they were compared to the previous year, although the total sales of electric vehicles were 31 percent higher. Sales in Germany also took place in January after the support of Musk’s remote AFD party. In Norway, Denmark and Sweden, sales fell by 40 percent year in February and France fell by 26 percent. The company is also suffering from organized boycott operations in the United Kingdom and Portugal.
Next, Tesla’s sales fell by about 50 percent, year on the year, in February in China and Australia by 71 percent declined on a large scale.
The main reason for these declines in sales has increased competition in traditional vehicle manufacturers as well as new, up-end electric vehicle companies, especially in China, where the automaker BYD reported a 90 percent increase in sales in February.
China is the second largest market in Tesla, but government policies are in favor of domestic manufacturers.
Tesla has repeatedly cut the prices of the vehicle in a bid to maintain demand in countries including the US and China. Although this strategy has helped promote short -term sales, experts say, it has also reduced overall earnings, which has increased concerns about long -term profitability among investors.
According to Lee, another major issue weighing on the minds of investors is Tesla’s failure in distributing innovations in other major areas such as self-driving technology and robotics.
He said, “Investors are looking for progress on self-driving, which stops, and other disappointment in robotics weighs on investor spirit,” he said.
Without new models or major technological progress, Tesla is struggling to maintain his reputation as an industry leader, which has contributed to the decline in his stock, he said.
How will all of this be affected by all this?
Elon Musk also includes many other companies and various industries, including X, social media platforms, formerly known as Twitter, which they bought in $ 44BN in 2022.
However, his personal property is closely linked to Tesla’s share price.
The acquisition of Twitter has become a financial burden, especially after the use of the X after supporting the mask of various right -wing parties in Europe and the use of X to transmit its trump stance. Billionaire was a prominent financial supporter of Trump’s President’s campaign last year, spending more than $ 250m in a personal performance on behalf of Trump.
His political activities have created anger among some people in the US, concluding Tesla dealerships, factories and charging stations in protests and arson attacks. There is a group of attacks on Tesla vehicles around Europe, including Germany, where many vehicles have slipped their tires.
Musk’s activities in Dogi can make him a goal for more IRE, experts say.
According to Scott, the federal government will be likely to cut thousands of jobs to bring back the budget and cut thousands of jobs. “A recession will make highly leveraged stocks such as Tesla especially difficult.”
Musk’s political activities have also inspired concerns among investors, Lee said.
He said, “Musk’s active participation in the US government is seen as a distraction from its companies the ability to produce innovations that he has promised on time,” he said.
How will Trump’s business policies affect Tesla?
While President Trump does not have a direct role in Tesla’s current conflicts, his policies, ongoing economic decisions and alleged impacts on musk may be important implications for the company, experts say.
For example, Trump has historically opposed subsidy for electric vehicle producers and emission rules that eventually benefit companies such as Tesla.
Trump has also imposed extensive tariffs on countries including China – which Tesla still depends a lot for export. Continuous trade with China can disrupt the supply chain of war Tesla and reduce its competition in an important market.
“Trump’s tariff has caused the implementation of tariffs on American exports to other countries. This will hurt Tesla’s sales abroad, ”said Scott.
Biden administration’s efforts to reverse clean energy policies can also further weaken the demand for electric vehicles, including Teslas, SCOTT.
What else is Tesla holding?
Beyond the financial challenges of Tesla, the expansion portfolio of Musk’s businesses has expressed concern about their ability to effectively lead the company with investors.
Scott pointed to Musk’s involvement in a cryptocurrency project, Dogicine, something that has no prior experience before tweeting for the first time in 2020, triggering a 20 percent increase in the price of cryptocycine made by software engineers in 2013. Then in December that year, Musk announced that he would accept Dogcoin as payment for Tesla Merchandise. Since then, Musk has been facing a litigation of $ 258 billion filed in New York in 2022, alleging that he artificially inflated the price of dogcoin through his social media influence.
Scott said, “The growing demand of Musk in his attention, as he tries to run both Dogi and his other businesses, means that some of them could only suffer from his lack of attention,” Scott said.
Musk’s rapid right -wing political trend may also affect Tesla’s brand perception. Many owners of the vehicle are environment conscious consumers who support permanent energy initiatives and are not a natural trump supporter, say of experts.
According to Lee, Musk is making a deliberate option to engage in government matters at the cost of Tesla’s performance.
“When he is trying to become a patriot and do well for the country, his investors and companies are being sacrificed to the future of the United States,” Lee said.
