If you"ve missed the news, Elon Musk announced over the weekend that he"s now forming his own political party in the United States, dubbed the America Party, to compete with democrats and Republicans. However, it appears that the stock market has not responded positively to the Tesla CEO"s announcement.
As CNBC reported, Tesla stock plummeted by 7.13 percent on Monday following Musk"s announcement of his new political party. The America Party, as Musk refers to it, is still in its early stages and has not yet been registered as an official party; however, investors are already concerned about its potential impact on the companies owned and managed by Elon Musk.
Musk says his goal by the America Party is to take "just 2 or 3 Senate seats and 8 to 10 House districts," which he believes is "enough to serve as the deciding vote on contentious laws, ensuring that they serve the true will of the people."
The billionaire Elon Musk and the Donald Trump administration had a falling out over the One Big, Beautiful Bill, which was signed into law on July 4th. Musk argues that this bill increases America"s debt, while Trump has been a vocal supporter. The $3.4 trillion bill also slashes tax credits for EV, solar, and wind energy, further fueling the disagreement.
In response to the recent moves by Elon Musk, Donald Trump wrote on TruthSocial that Musk has gone completely "off the rails" and has become a "TRAIN WRECK" over the past few weeks. Trump also added that a third party has never succeeded in the United States.
"It is a Great Bill, but, unfortunately for Elon, it eliminates the ridiculous Electric Vehicle (EV) Mandate, which would have forced everyone to buy an Electric Car in a short period of time. I have been strongly opposed to that from the very beginning. People are now allowed to buy whatever they want - Gasoline Powered, Hybrids (which are doing very well), or New Technologies as they come about - No more EV Mandate."
It"s a challenging time for Tesla, as its sales and stock value have been on a downward trend over the past few months. The EV maker lost roughly $150 billion in market value last month, and its profit for Q1 2025 has seen a staggering 71 percent decline.