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Tesla never stops falling. The American automaker has lost nearly 70% of its value on the stock market this year and its share price collapsed by more than 11% on Tuesday, December 27. The automaker, owned by businessman Elon Musk, achieved one of the worst performances of the year in this sector.
The extent of the fall surprises, and especially worries shareholders. Tesla was used to being at its highest on Wall Street, with a stock hitting $380 in November 2021. However, it fell to $109 on Tuesday, December 27, its lowest level in just over two years.
There are several reasons for this impressive fall. First of all, the acquisition of Twitter by its owner Elon Musk did not reassure the markets. To finance the takeover of the social network, the billionaire had to sell part of its shares from Tesla. This failed operation rubbed off on the entire Musk galaxy. According to Victoria Scholar, director of investments at Interactive Investor, investors are also worried that Elon Musk is spending too much time on Twitter at the expense of the automotive group.
If the title of the automaker fell to 109 dollars at the close of the New York Stock Exchange, it was in reaction to information from Reuters which set fire to the powder. Tesla indeed plans to reduce, in January 2023, production at its Shanghai plant, in anticipation of a drop in demand in China, yet the largest automotive market in the world.
Serious concerns among investors
For Thomas Hayes, president of Great Hill Capital, Tesla faces a ” perfect storm » high interest rates, tax-loss sales and releases from certain funds that held large amounts of the manufacturer’s shares.
Another blow for Tesla: the prices of its used vehicles are falling faster than those of other manufacturers, having an immediate impact on demand for the group’s new vehicles. After a catastrophic year 2022, investors are therefore deeply concerned and are calling for the return of a real captain at the head of the Tesla ship… whether or not it is Elon Musk.
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(And with AFP)