Tesla stock marks lowest close in years as investors worry about Musk’s focus | Tesla

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Tesla shares fell to their lowest in more than two years on Tuesday as Elon Musk’s electric car maker faces a difficult financial period, marking the company’s worst day in eight months.

The company’s stock has fallen by more than half since the beginning of October. Investors are concerned that Musk, now the social network owner and CEO, spends a lot of time on Twitter.

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His tenure as head of the platform saw turmoil as he implemented and often reversed many new policies. Musk recently said he would find a new CEO to replace him as most of his Twitter users in a poll voted for him to step down. Experts say his erratic behavior has undermined confidence in Tesla, and the stock has fallen 73% since November 2021.

Tesla shares fell 11.4% Tuesday’s losses, followed by a Reuters report that the company was planning to implement a reduced production schedule at its Shanghai factory in January. Covid-19 has raised concerns over falling demand in the world’s largest car market amid rising numbers of cases.

“There is definitely concern about demand,” said Thomas Hayes, chairman of Great Hill Capital, citing expectations of a cut from Chinese rival Nio in key markets.

Hayes also added that Tesla shares are facing a “perfect storm” of high interest rates, tax losses and stock sales by some funds that hold large amounts of Tesla stock.

A tax loss sale is when an investor sells an asset with a capital loss to reduce or eliminate the capital gains realized by other investments for income tax purposes.

Meanwhile, prices for used Tesla cars are falling faster than other automakers, squeezing demand for the company’s new cars off the assembly line, according to a Reuters analysis.

Before Musk Attribution Tesla has recently struggled with interest rate hikes from the Federal Reserve, saying “people will move more and more money out of stocks and into cash, and stocks will fall.”

The billionaire himself this year sold nearly $4 billion in Tesla stock to raise money to buy Twitter, which he bought for $44 billion. He said in his mid-December that he would not sell any more Tesla shares, “at least for 18 to 24 months.” However, according to financial reports, he sold millions after making a similar promise in April 2022.

Analysts have raised the possibility that Musk will be asked to resign from Tesla’s leadership over his actions on Twitter.

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