Tesla Inc. ($TSLA) Stock: Slides 8% Amid Trump-Musk Rift and EV Market Woes

TLDR

Tesla stock dropped 8.34% to $304.35 after Trump slammed Musk over EV tax bill comments UK Tesla sales fell 36% in May as BYD and VW gained ground Musk’s political disputes and DOGE inefficiencies spark investor concern Tesla’s robotaxi event on June 12 is seen as critical to future valuation Earnings expected between July 21–25, 2025

Tesla Inc. (NASDAQ: TSLA) shares dropped 8.34% to $304.35 as of 12:56 p.m. ET Thursday after former President Donald Trump rebuked Elon Musk over his vocal opposition to a controversial tax bill.

Tesla, Inc. (TSLA)

Trump publicly criticized Musk for his sharp turn against the bill, saying, “He only developed the problem when he found out that we’re going to have to cut the EV mandate.” Musk’s response was a terse “Whatever” on X, the platform he owns. The confrontation marks a significant break between two figures previously aligned on key issues.

The clash casts uncertainty over Tesla’s political clout. Musk had once been appointed head of the Department of Government Efficiency (DOGE), a Trump-created entity, but criticism has grown over DOGE’s lackluster impact on federal spending. Musk’s online campaign against the bill included strong rhetoric like “KILL the BILL,” raising questions about how this dispute could affect Tesla’s access to federal support and policy levers.

EV Market Share Erosion in the UK

At the same time, Tesla’s UK market share is deteriorating. The company sold 2,016 vehicles in May, down 36% from a year earlier, according to the Society of Motor Manufacturers and Traders (SMMT). In contrast, Chinese competitor BYD sold 3,025 units, representing a 407% increase. Tesla’s year-to-date UK sales are also down 7.8%.

🚗⚡ UK Car Sales Rise in May as EV Discounts Drive Surge, Tesla Slumps

New registrations rose 1.6% YoY, with EVs making up 47% of sales—buoyed by aggressive price cuts.

Tesla’s UK sales tumbled 36% as Chinese rivals intensified pressure in a growing electric price war. pic.twitter.com/bs1YaBQJbS

— PiQ (@PiQSuite) June 5, 2025

The EV market in the UK grew by 1.6% in May, largely due to rising corporate demand. However, Tesla’s weakening position signals its struggle against a rising tide of competition. Volkswagen is close to overtaking Tesla in EV sales in the UK, and other automakers like Ford, Renault, and Peugeot are making major gains.

Robotaxi Hopes and Political Risk

Much of Tesla’s long-term valuation rests on its push into autonomous driving. A major robotaxi test is scheduled for June 12 in Austin. Investors view this event as a pivotal moment, especially as Tesla tries to offset recent declines with innovation in self-driving technology.

Yet, political unrest may undercut those efforts. Musk’s relationship with Trump once helped Tesla gain regulatory flexibility, including with the National Highway Traffic Safety Administration. With that alliance now strained, Tesla may face more resistance on regulatory fronts.

Performance Snapshot and Earnings Outlook

Despite Thursday’s drop and a 24.71% year-to-date decline, Tesla’s stock remains up 73.75% over the past year. Over five years, it has returned 414.98%, outpacing the S&P 500’s 86.58%. Still, the three-year return trails the benchmark, highlighting the recent slowdown.

Tesla’s Q2 earnings are expected between July 21 and July 25, 2025. With pressure mounting from both political fronts and competitive headwinds, the earnings call will be closely watched for guidance on margins, innovation, and strategy amid volatile conditions.

 

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