Tesla’s stock price has taken a severe hit, with its market capitalization evaporating by over $76 billion in just two days. This is mainly due to a series of setbacks in China and Germany, coupled with a global slowdown in the growth of the electric vehicle market.
On May 5 (local time), Tesla’s stock closed at $180.74 on the New York Stock Exchange, down 3.93% from the previous day. This follows a 7.16% drop the day before, bringing the total loss in market capitalization to around $76 billion in just two days.
The stock’s decline was influenced by news of a suspected sabotage attack on Tesla’s German factory, the Berlin Gigafactory, which resulted in a halt in production. The factory, which stopped operating after the power was cut off at 5:15 a.m., is expected to remain shut down until at least early next week, according to Reuters. As a result, 1,000 vehicles were not completed that day, and the loss from this power outage is estimated to be in the hundreds of millions of dollars.
The saboteurs are believed to be the Volcano Group, a left-wing extremist environmental group. Tesla has faced strong opposition from environmental groups and residents since it began expanding the Berlin Gigafactory last year.
In response, Tesla CEO Elon Musk criticized the group on his social media platform X, calling them “the dumbest environmental terrorists on the planet” and stating that “it’s foolish to stop the production of electric cars, not fossil fuel cars.”
The day before, Tesla’s stock was hit by the news that shipments from its Shanghai factory in February had decreased by 19% compared to a year ago.
This year, Tesla’s stock has plunged nearly 27% due to bad news. In addition to being overtaken by China’s BYD in global electric vehicle sales in the fourth quarter of last year, the company is expected to face a slowdown in demand for electric vehicles for the foreseeable future. The risk from the owner, including Elon Musk’s involvement in drug parties and various lawsuits, is also increasing.
Among the top five in market capitalization in the U.S. stock market in 2021 and 2022, Tesla has fallen to 12th place due to the continuous drop in stock prices. As a result, voices are growing in the securities market that Tesla should be removed from the Magnificent 7 (M7), a list of seven major companies leading the U.S. stock market rally.
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