LONDON (Reuters) — Tesla shares sank more than 3% on Monday, weighed down by investor fears over CEO Elon Musk’s concentration after he revealed plans to join a new US political party, escalating his spat with President Donald Trump.
Tesla shares plunged more than 3% in Frankfurt, hinting to more declines once premarket trading resumes after the three-day Independence Day vacation.
Wedbush’s veteran tech analyst Dan Ives stated that Musk was Tesla’s “biggest asset” and that his choice to delve more into politics would certainly put the company’s stock under pressure.
“Tesla needs Musk as CEO and its biggest asset and not heading down the political route yet again…while at the same time getting on Trump’s bad side,” Ives said in a message to subscribers on Sunday.
“It would also not shock us if the Tesla board gets involved at some point given the political nature of this endeavour depending on how far Musk takes it.”
On Sunday, Trump labeled Musk’s ambitions to join the “America Party” “ridiculous,” unleashing further insults at the tech tycoon and claiming that the Musk associate he originally picked to oversee NASA would have presented a conflict of interest given Musk’s space firm.