Tesla shares fell as much as 4.5% at the open on Wall Street today after two major investment research firms downgraded the stock, citing growing uncertainty tied to CEO Elon Musk’s escalating feud with former President Donald Trump.
The electric vehicle maker’s stock is down roughly 30% so far this year, with the latest slide triggered by renewed concerns over brand stability and market demand. The dispute took a dramatic turn when Musk publicly called for Trump’s impeachment, alleging the former President is named in secret government files related to disgraced financier Jeffrey Epstein. Trump fired back on Friday, claiming Musk had “lost his mind,” despite earlier suggestions from officials that the spat was over.
Argus Research downgraded Tesla from Buy to Hold, warning that the stock is increasingly being influenced by “non-fundamental events.” Analysts noted: “Looking ahead, we are concerned that the war of words between President Trump and Elon Musk, along with the expiration of EV credits, could further weaken demand for new Teslas.”
Baird also downgraded its rating from Outperform to Neutral, with analyst Ben Kallo pointing to the risks associated with Musk’s political activities. “The recent incident between Musk and President Trump exemplifies key-person risk,” he said, adding that it could further raise concerns about brand damage unless Tesla can demonstrate sustained growth in vehicle deliveries.
