the rout in tesla
shares is accelerating as a recall and signs of china’s return to covid zero curbs adds to a litany of investor concerns, with chief executive officer elon musk focused on turning around twitter inc. the electric-vehicle maker’s stock dropped as much as 6.5% to $168.52 in new york on monday, on pace to close at the lowest since november 2020. trader anxiety was higher after a city near beijing returned to lockdowns, putting both production and sales at risk. tesla
also initiated a recall of more than 300,000 cars due to faulty taillights. tesla
’s shares have lost nearly half of their value in less than two months as supply-chain snarls mount, raw-material costs soar and potential buyers feel the squeeze of stubborn inflation and rising interest rates. on top of that, musk has been preoccupied by his newly acquired social-media platform, leaving some investors to worry that tesla
’s strategy may fall to the wayside. “weakening macro data in china is leading to concerns on tesla
, who has already lowered price once to stimulate demand and has a heavy export output in the first half of fourth quarter,” cowen analyst jeffrey osborne wrote in a friday note. the analyst added that hedge funds seem to be shifting to a negative bias on the stock due to risk there’s been “a loss of focus” on tesla
since musk acquired twitter. the company’s recent stock decline marks a major retracement of several milestones reached during its meteoric rise in 2020 and 2021. tesla
was supplanted as the fifth-most valuable company on the s&p 500 index by old-economy stalwart berkshire hathaway inc. earlier this month. the car company, which lost its trillion-dollar-valuation status in late april, only needs its shares to tumble another 6.5% from current levels for the valuation to drop below $500 billion.