Shares of Tesla, the US electric carmaker, plummeted by over 15%, wiping out the gains the company had seen following the US presidential election in November.

The sharp decline came after a lowered delivery forecast from an analyst, which exerted further downward pressure on the stock price.

Tesla’s stock had surged in the wake of President Donald Trump’s victory, peaking in mid-December when its value was nearly double what it had been on Election Day. However, the stock has been on a steady decline since then, with the drop accelerating in recent weeks.

Tesla’s performance in 2024 also saw a troubling trend, as the company ended the year with its first decline in deliveries in over a decade, despite Elon Musk’s earlier predictions of growth.

Musk has continued to captivate investors by promising breakthroughs in self-driving cars and humanoid robots, though success in these areas remains uncertain.

Tesla’s market capitalisation reached a high of $1.5 trillion in mid-December, with shares trading at around $480, but the recent decline has seen the stock fall to about $222, dropping the company’s value to around $715 billion.

In contrast, traditional US car manufacturers like Ford and General Motors are valued at $40 billion and $48 billion, respectively.

Elon Musk’s personal wealth is deeply tied to Tesla’s stock price. The billionaire uses his shares as collateral for loans, meaning a significant drop in the stock price could lead to financial challenges for Musk.

Bloomberg estimates Musk’s net worth at approximately $300 billion, making him the world’s richest person.

Tesla’s close ties to the Trump administration, with Musk serving as a cost-cutter for the US government, initially led some market observers to speculate that the company might benefit from the president’s influence.

On the other hand, US President Donald Trump announced on March 11, 2025, that he will buy a “brand new Tesla” to show his support for Tesla CEO Elon Musk, who has been a major campaign donor and advisor.

Trump expressed his admiration for Musk’s efforts in helping the nation, calling him a key figure in the effort to “Make America Great Again.”

In a post on his Truth Social platform, Trump accused the “Radical Left Lunatics” of trying to harm both Musk and Tesla, claiming they were attempting to boycott the automaker.

Trump’s statement comes as Musk, who currently heads the Department of Government Efficiency (DOGE), has been leading a campaign to reduce federal government spending and agency workforces.