California: Tesla shares tumbled about 50 per cent from their all-time high, amid a broader selloff in the US stock market that has hit growth and technology companies especially hard.
The electric vehicle-maker’s shares closed down 7.6 per cent to $204.99 on Friday, taking its market capitalization to $642 billion. The decline has now sliced in half the stock’s November 4 record closing high of $409.97.
The plunge comes amid a wider meltdown in the markets, as the specter of an economic slowdown rattles investors already bracing for the impact of rising inflation and higher interest rates. Riskier growth stocks with rich valuations have borne the brunt of the selloff.
Tesla’s own list of woes are long: Vehicle delivery in the third quarter took a hit due to logistical troubles, and some analysts warned that the climbing prices of the company’s cars may also weigh on demand at some point. On top of that, Tesla’s factory in Shanghai has faced disruptions due to Covid lockdowns in the city. The company has also dealt with supply shortages and a surge in raw material costs, as has almost every other automaker around the globe.
CEO Elon Musk’s highly public attempt to first buy Twitter, then to walk away from the deal and buy it again, has also been a drag on the stock, due to concerns that the company’s leader is spreading himself too thin between several challenging ventures.