Tesla Stock Falls 15% Amid Trump-Musk Political Drama and Market Skepticism

Following recent turmoil in Tesla’s stock performance, which saw a 15% plunge on March 10, marking its worst day since September 2020, the company finds itself amidst heightened political tensions. On the evening of March 10, former U.S. President Donald Trump voiced support for Tesla’s founder and CEO, Elon Musk, through his social media platform, Truth Social. Trump announced his intention to purchase a “brand new Tesla” the following morning as a gesture of confidence in Musk’s leadership and in the company amidst growing criticisms from left-wing circles.

Musk's challenges extend beyond the stock market; his alignment with Trump's government has become a focal point, influencing market perceptions. Musk, while maintaining his businesses, has been actively involved with a Trump-led effort aiming at downsizing federal governmental operations, which sparked debates and criticism. Despite political pushback, Trump’s endorsement underscores the ideological divide affecting corporate American giants, with Musk at the epicenter.

In recent months, Tesla’s stock had been on a downward trajectory, shedding nearly 45% value by early 2025. This decline coincides with Musk’s increased political engagements and criticisms, which reportedly include adverse impacts on Tesla's international market presence, notably in Germany, where Tesla registrations sharply declined following Musk's endorsement of far-right political elements.

Musk has acknowledged the difficulties in managing Tesla’s operations alongside his political endeavors. However, the public affirmation from Trump adds another dynamic to the unfolding narrative, possibly impacting Tesla's future stock prospects and strategic positioning amid these complex relations. The interplay of political confidence and market skepticism presents a challenging landscape for Tesla as it navigates reputational and fiscal recovery.