Tesla shares slide 8% as Musk's 'America Party' worries investors
Make us a preferred source
Make us a preferred source on Google
The news: Shares in Tesla slipped in early trading on Monday, after CEO Elon Musk’s plans to launch a new US political party sparked concerns about his level of attention on the EV maker.
The numbers: Shares in Tesla fell almost 8% on market open in New York, wiping over USD71 billion ($110 billion) from the company’s market value.
The context: Tesla founder and CEO Elon Musk on Saturday shared his plans to launch a new political party, stating on X: “Today, the America Party is formed to give you back your freedom.”
“By a factor of 2 to 1, you want a new political party and you shall have it! When it comes to bankrupting our country with waste & graft, we live in a one-party system, not a democracy,” Musk announced.
The news prompted investment firm Azoria to postpone the listing of its Azoria Tesla Convexity exchange traded fund (ETF), which had been scheduled to be launched this week. The firm’s CEO, however, took to X to state that he was unhappy with Musk’s decision and that he would continue to support US President Donald Trump.
Azoria chief James Fishback said: "I encourage the Board to meet immediately and ask Elon to clarify his political ambitions and evaluate whether they are compatible with his full-time obligations to Tesla as CEO.”
Fishback said that the move “creates a conflict with his full-time responsibilities as CEO of Tesla,” as it diverts his focus and energy away from Tesla’s employees and shareholders.
On Monday, US President Trump responded to Elon’s announcement, saying: “I’m saddened to watch Elon Musk go completely ‘off the rails,’ essentially becoming a TRAIN WRECK over the past five weeks.” Trump called Musk’s plans to launch the party “ridiculous” and said that the move would sow confusion. “The one thing Third Parties are good for is the creation of Complete and Total DISRUPTION & CHAOS, and we have enough of that with the Radical Left Democrats.”
The news comes after Trump signed his ‘big, beautiful’ megabill into law on Friday, which had been strongly opposed by Musk. The former allies have been engaged in an extended dispute over social media, with Trump threatening to cut off billions of dollars in subsidies to Musk’s companies.
The sources: Reuters, Bloomberg, CNN, Trump Truth Social, Sky News
