Tesla Stock Tumbles After Trump Criticizes Musk’s ‘America Party’

Tesla (TSLA) shares are sinking roughly 6% in premarket trading after CEO Elon Musk announced he would form a new political party in an escalation of his feud with President Donald Trump.

Musk on Saturday announced the formation of the “America Party” after a July 4 poll on his X platform indicated 65% of responders supported the move. The post came just weeks after the Tesla CEO said he would refocus on his companies following a backlash to his role leading the Trump administration’s cost-cutting Department of Government Efficiency, or DOGE. 

On Sunday, Trump wrote on his Truth Social network that third political parties “have never succeeded in the United States,” and that Musk had gone “off the rails.”

Tesla shares entered Monday down by more than fifth so far this year. They have been dogged by investor concerns of his distraction from his role running the EV maker and his ongoing spat with Trump, his former ally, over the “One Big Beautiful Bill” the president signed into law last week. Falling global sales, as well as the removal of EV tax credits in Trump’s signature budget bill, are also weighing on the stock.