Trading Desk: Tesla’s Shareholders Learn a Hard Lesson in Political Theater

In the latest episode of “When Titans Clash,” Tesla’s stock was the designated casualty. The electric automaker saw its shares plummet over 14% on Thursday, wiping out a staggering $150 billion in market value after its CEO and the U.S. president decided to air their grievances in public. One has to wonder if the market ever gets tired of these predictable tantrums.

The spat, it seems, was over a “big, beautiful bill.” Musk, having recently departed his post as the head of the ambivalently named Department of Government Efficiency (DOGE), suddenly found his conscience, launching a crusade against the bill’s $2.4 trillion price tag. He urged his followers to “KILL THE BILL” — a noble stand for fiscal responsibility, to be sure.

Of course, the administration saw it differently. The president expressed his profound “disappointment,” suggesting his former ally’s newfound principles conveniently coincided with learning that the bill might trim the very EV mandates that have so generously padded Tesla’s bottom line.

In response to Musk’s social media barrage, the President mused about terminating the government subsidies and contracts that have been a cornerstone of the CEO’s sprawling business empire. A classic case of biting the hand that feeds you — and the hand threatening to clap back.

For investors, this was just another day of their portfolios being held hostage by ego. What was once a celebrated partnership, with the CEO as a key administration supporter, has soured with remarkable speed. The market, which once priced in the benefits of this cozy political connection, is now frantically pricing in the risk.

This all unfolds while Tesla faces actual business challenges, like softening demand and ever-present competition from rivals like Waymo in the autonomous driving race. But why focus on fundamentals when you have a high-stakes political drama to watch?

For Tesla, it seems the company’s valuation now hinges less on its robotaxi progress and more on the mercurial moods of men who used to be friends. Investors are just left holding the popcorn — and what’s left of their stock.