Tesla stock hits lowest closing level in years as investors worry about Musk’s focus | Tesla

Tesla shares fell on Tuesday to their lowest in more than two years, marking the company’s worst day in eight months, as electric car maker Elon Musk faces a difficult financial period.

The company’s stock has lost more than half its value since the beginning of October. Investors are worried about that Twitter It takes a lot of Musk’s time, as he is now the owner and CEO of the social network.

His tenure as chair of the platform was chaotic as he implemented – and often reversed – a range of new policies. Musk recently said he would find a new CEO to replace him after most Survey Twitter users They voted for him to step down. Experts say his erratic behavior has undermined confidence in Tesla, with shares down 73% from November 2021.

Tuesday’s loss that saw Tesla Shares fell 11.4%, following a Reuters report that the company was planning to run a reduced production schedule in January at its Shanghai plant. That news raised fears of a drop in demand in the world’s largest car market, amid the rising number of Covid-19 infections in China.

“There is no doubt that there are concerns about demand,” said Thomas Hayes, chairman of Great Hill Capital, citing lower delivery expectations from Chinese competitor Nio in the main market.

Hayes also added that Tesla stock was facing a “perfect storm” from rising interest rates, tax loss selling and stock sales by some of the funds that own a significant amount of Tesla stock.

A tax loss sale is when an investor sells an asset at a capital loss to reduce or eliminate the capital gains realized through other investments for income tax purposes.

Meanwhile, A.J Reuters analysis It showed that prices for used Tesla cars were dropping faster than those of other automakers, which affected demand for the company’s new cars rolling off the assembly line.

Musk previously attributed Tesla has recently been fighting to raise interest rates from the Federal Reserve, saying “people will increasingly turn their money out of stocks into cash, causing stocks to drop.”

The billionaire himself dumped Tesla shares this year, selling nearly $4 billion of his Tesla stock to fund the $44 billion buyout of Twitter. He said in mid-December won’t sell Additional Tesla inventory “for a minimum of 18 to 24 months.” However, financial filings show that he sold millions after making similar promises in April 2022.

Analysts have raised the possibility that Musk could be asked to step down as CEO at Tesla over his actions on Twitter, over which he already faces a lawsuit. alleged failure To focus on Tesla because of overseas projects.

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