Tesla’s shares plunged by over 15% on Monday, erasing all gains made after the U.S. presidential election in November.
The sharp drop followed a downgrade by UBS Global Research on delivery forecasts. Analysts at the US investment bank research house expect deliveries to fall by 5% in the first quarter and in the year, compared to the corresponding periods for 2024.
Tesla CEO Elon Musk became a close ally of U.S. President Donald Trump during the presidential campaign.
Following Trump’s victory, Tesla’s stock soared to a peak in mid-December, almost doubling in value from early November. However, the price has fallen consistently since then, with the decline accelerating in recent weeks.
Tesla ended 2024 with its first decrease in deliveries in over a decade, despite Elon Musk’s growth projections.
The billionaire, who also leads social media platform X and SpaceX, has kept investor interest alive by promising future ventures in autonomous cars and humanoid robots, though success in these areas remains uncertain.
Investors have continued to value the company highly, far surpassing traditional automakers.
In mid-December, Tesla’s market capitalisation reached over $1.5 trillion, with shares trading around $480. As of Monday, the stock price fell to approximately $222, bringing the market capitalisation down to around $715 billion.
For comparison, American automotive giants Ford and General Motors are valued at $40 billion and $48 billion, respectively.
