Following one of the worst single-day declines in Tesla's history, President Donald Trump voiced his support for Tesla CEO and billionaire Elon Musk, pledging to purchase one of his cars.
This came after Tesla faced mounting challenges, including increased competition from Chinese electric vehicles and backlash over Musk’s controversial political ties, particularly his support of Trump and far-right causes.
Tesla's stock has fallen 45% in 2025, and on Monday, it dropped over 15%, reaching $222.15 per share, the lowest since October, signaling waning confidence amid declining global sales. In a post on Truth Social, Trump defended Musk, claiming that "Radical Left Lunatics" were trying to "illegally and collusively boycott" Tesla, which he referred to as "one of the world's great automakers" and Musk's “baby.”
Before markets opened on Tuesday, Tesla shares rose by more than 3%. Analysts have pointed to Musk's alignment with Trump and far-right figures as contributing factors to Tesla's stock and sales slump. Recently, protests have targeted Tesla showrooms in the U.S., with some owners placing bumper stickers on their cars, distancing themselves from Musk's political views.
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Amid the turmoil, a woman was charged for vandalizing a Tesla dealership in Colorado, including throwing Molotov cocktails and spray-painting "Nazi cars" on the building. Musk, who contributed $270 million to Trump’s 2024 campaign, has been a prominent supporter of the Trump administration’s cuts to government spending.
Tesla's sales have dropped significantly in key markets like California and Europe. In January, Tesla saw a 45% sales decline in Europe, particularly in Germany and France, while its market share in China also nearly halved due to rising competition. Analysts predict further sales declines, forecasting a 5% drop in U.S. deliveries in the first quarter of 2025.
Musk's political stance, which includes supporting far-right and pro-Russian causes, has alienated some potential Tesla buyers, especially those in progressive circles. Additionally, his other ventures, such as the X social media platform and SpaceX, have faced setbacks, with X experiencing multiple crashes and SpaceX rockets failing.
Tesla's struggles reflect broader challenges for Musk, whose controversial politics seem to be taking a toll on his companies.