Automotive industry Tesla share price falls by more than 15 percent in one day
Shares in Tesla, the electric car manufacturer led by Elon Musk, have fallen by more than 15 percent in one day. As a result, it also lost the last price gains after the US presidential election in November.
11.03.2025, 02:06
SDA
Musk had become a close ally of the ultimately victorious Republican Donald Trump during the US election campaign. Following his triumph in the presidential election, Tesla shares soared. At its peak in mid-December, it was worth around twice as much as on election day on November 4. This was followed by a downward slide, which recently became steeper.
Before the accelerated share price losses on Monday, another analyst had lowered the forecast for Tesla deliveries.
Tesla had closed 2024 with the first decline in deliveries in more than a decade, although Musk had previously forecast an increase. However, the tech billionaire is enticing investors with the prospect of big business in self-driving cars and humanoid robots. Although it is not certain that Tesla can be successful in either area, investors have so far overlooked the current business and are valuing the company much higher than other car manufacturers.
In mid-December, Tesla was worth more than 1.5 trillion dollars at a share price of around 480 dollars. Now the stock market value has fallen from just over 222 dollars to around 715 billion dollars. By comparison, the US car giant Ford is worth just under 40 billion dollars on the stock market, and its rival General Motors just under 48 billion dollars.
Musk's fortune depends on Tesla's share price
A significant fall in the Tesla share price could also become a problem for Musk personally. The tech billionaire is known for collateralizing loans with his Tesla shares, making him by far the richest person in the world, at least on paper. In such transactions, collateral often has to be provided if the share price falls below certain thresholds. The Bloomberg financial service still estimates Musk's assets at a good 300 billion dollars.
Musk's closeness to Trump drove up share price
After the election, some market observers assumed that Musk's proximity to the US president could benefit Tesla. Trump made him a cost-cutter on behalf of the US government and gave him far-reaching powers. The President assured him that no conflicts of interest would be allowed.
Among other things, Tesla's Autopilot assistance system is the focus of several investigations by the National Highway Traffic Safety Administration (NHTSA) following accidents. The authority would also play a key role in the approval of the self-driving robotaxis envisaged by Musk. He wants to dispense with the more expensive laser radars and rely solely on cameras for the self-driving cars. However, many experts believe that laser radars are essential if self-driving cars are to be safe on the roads. Google's sister company Waymo also uses such technology in its reliably functioning robotaxis.
