Musk wants to found a party - Tesla shares fall
Tesla shares fell significantly on Monday after CEO Elon Musk announced the formation of his own political party. In addition, US President Donald Trump signed the tax and spending bill into law over the weekend, which would eliminate electric car subsidies in the US. Tesla shares began US trading with a loss of around 7 percent.
The electric car manufacturer has been struggling with declining deliveries for some time. Analysts believe that Musk's right-wing views and political activities have contributed to and damaged the Tesla brand. Following Musk's party announcement, several analysts expressed criticism.
Dan Ives of Wedbush Securities called for the board to intervene. Jed Dorsheimer of the financial firm William Blair emphasized that investors viewed the foray into politics as a distraction, while the Tesla business needed Musk's attention. Musk announced in the spring that he would return to Tesla's concerns after months of serving as Trump's cost-cutting agent in Washington.
Musk announced over the weekend the founding of a party called the America Party, which is intended as a third force alongside Trump's Republicans and the Democrats.
Musk is by far the richest person in the world, with an estimated net worth of more than $360 billion. However, this primarily consists of his holdings in Tesla and the privately held space company SpaceX. Thus, Musk's wealth also declines along with the price of Tesla shares.
RND/dpa
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