**Tesla Shares Plunge 15%, Marking the Steepest Drop in Five Years**
**Key Highlights:**
– Tesla’s stock dropped 15%, its largest decline since 2020, following a seventh consecutive week of losses.
– The company has now lost over half of its market value since its peak in December, resulting in a market cap loss of around $800 billion.
– Tesla’s slide coincides with CEO Elon Musk’s increasing political involvement in the Trump administration.
**Tesla Faces a Sharp Market Decline**
On Monday, Tesla’s stock took a significant hit, falling by 15%, the steepest decline since September 2020. This drop capped off a week in which Tesla experienced its seventh straight week of losses, the longest losing streak since the company went public in 2010.
Since hitting a high of $479.86 on December 17, Tesla shares have lost more than 50% of their value, wiping out over $800 billion in market capitalization. This latest downturn also contributed to a broader slump in U.S. equities, with the Nasdaq falling nearly 4%, its sharpest drop since 2022.
**Uncertainty Over Tariffs and Political Issues**
The decline in Tesla’s stock is partially tied to growing uncertainty surrounding potential tariffs on key markets like Canada and Mexico. If these tariffs increase or lead to a trade war, it could result in higher production costs and increased prices for consumers.
Tesla’s struggles are also connected to CEO Elon Musk’s involvement in the second Trump administration. Musk, who leads the Department of Government Efficiency, is spearheading efforts to significantly reduce the federal government’s workforce and spending. His involvement in controversial political discussions, along with his rhetoric on his social media platform X, has led to growing backlash against the company.
**Vandalism and Protests Weighing on Tesla’s Image**
Tesla has also faced protests and growing hostility from activists and former supporters, which has damaged the company’s image. Tesla properties have been targeted by acts of vandalism and even arson, with one recent incident at a Tesla service center in Loveland, Colorado, on March 7.
Ben Kallo, an analyst at Baird, expressed concerns that these acts of vandalism could harm demand for Tesla vehicles. “When customers fear that their cars might be damaged or destroyed, even those who are neutral or supportive of Musk may reconsider buying a Tesla,” Kallo warned.
**Falling Sales and Intensifying Competition**
In addition to its declining stock price, Tesla is facing a significant drop in vehicle sales. Bank of America reported that Tesla’s new vehicle sales in Europe fell by 50% in January compared to the previous year, partly due to growing dissatisfaction with the brand. Some customers are also waiting for newer versions of Tesla’s vehicles, like the updated Model Y.
Despite the sales slump, the Model Y, a small SUV, remained the best-selling electric vehicle worldwide in January. It was followed by the Geely Geome from China, which surpassed the Tesla Model 3 in sales for the month.
While Tesla’s challenges continue, the global electric vehicle market saw an overall 21% increase in sales during January, driven primarily by strong demand in Europe. This growing competition signals that Tesla faces mounting pressure as the EV market expands and diversifies.