Saad Ullah
Tesla (TSLA) stock experiences dramatic 15% drop, marking its widest decline in five years and erasing $130 billion in market value as CEO Elon Musk loses $29 billion of personal wealth.
TSLA Records Seven-Week Losing Streak Since Trump's Inauguration
Tesla stock (TSLA) emerged as Tuesday's biggest market loser, plummeting as much as 15% in a single trading session. While the broader market experienced a significant downturn, Tesla's performance was particularly striking, marking its worst single-day decline since September 2020. This dramatic slide wiped approximately $130 billion from the company's market capitalization, while Tesla CEO Elon Musk personally saw his net worth drop by $29 billion.
Tesla (TSLA) Erases 55% of Value Since December Peak
The electric vehicle manufacturer has now lost more than 55% of its value since reaching its record valuation on December 17, representing approximately $800 billion in erased market capitalization. Over this same period, Musk has personally experienced a staggering $180 billion reduction in his net worth. The current decline caps what has been a deeply troubling period for the automaker and its high-profile chief executive.
Musk Juggles White House Role as TSLA Faces Brand Erosion
The company's market struggles coincide with Musk's increasing political involvement. Since President Trump's inauguration on January 20, Tesla hasn't experienced a single winning week, instead recording a seven-week losing streak—the longest downward trend since the company's Nasdaq listing in 2010. Musk, who now serves as a "special government employee" in the Trump administration, admitted in a Monday after-hours interview that he's running Tesla "with great difficulty" while simultaneously implementing controversial cost-cutting measures at DOGE.
Musk's political activities appear to be taking a toll on Tesla's brand perception. During his interview, Musk predicted achieving "$1 trillion of savings" through his cost-cutting initiatives, though he acknowledged they will "make mistakes." Some of DOGE's largest announced cost reductions have reportedly been removed from its website. Adding to the controversy, Musk recently called for the United States to "quit NATO now," claiming it "doesn't make sense for America to pay for the defense of Europe."
Market analysts suggest that Tesla is suffering from significant brand erosion resulting from Musk's political activities, which he has described as wielding a "political chainsaw." The company has eliminated more than 10,000 jobs since February and shuttered entire departments in a sweeping restructuring effort.
Further complicating Musk's challenges, his other ventures have faced recent setbacks, including two consecutive SpaceX rocket explosions and multiple outages on the social media platform X that occurred Monday, coinciding with Tesla's stock collapse.
The sustained pressure on Tesla's stock raises questions about the long-term impact of Musk's divided attention and controversial political stances on the electric vehicle maker's market position and brand value. As Tesla continues its longest losing streak in company history, investors appear increasingly concerned about the potential long-term consequences of Musk's expanding political role and its effect on his ability to effectively lead the automaker.
Despite these challenges, neither Tesla nor Musk have issued formal statements addressing the stock's dramatic decline or outlining specific plans to reverse the company's market trajectory.
Saad Ullah
