Tesla shares dropped over 5% in morning trading. The stock has fallen more than 70% this year.
In 2022, Tesla stock was under great pressure, though it completed a 3-for-1 stock split, Musk’s selling shares and his Twitter drama made it suffer the worst year since its IPO.
Musk has said he will not sell any more of the electric car company’s stock for about two years on last Thursday, however,he foresaw the economy would be in a “serious recession” in 2023 and demand for big-ticket items would be lower.
Moreover, he has previously made promises about not selling Tesla stock before subsequently selling it. When Musk disclosed another $3.6bn in stock sales, taking his total near $40bn since late last year and frustrating investors as the company’s shares wallow at more than two-year lows.
Another thing to mention is that he pointed out that Tesla’s board was open to a share buyback but that will depend on the scale of a recession.
Tesla stock has plummeted since CEO Elon Musk took over Twitter, falling more than 45% in about over two months.
Moreover, some analysts and major investors have sharply criticized Musk over a perceived lack of focus on Tesla, saying the company needs leadership as it contends with an adverse business environment.
"Musk is viewed as 'asleep at the wheel' from a leadership perspective for Tesla at the time investors need a CEO to navigate this Category 5 storm," Dan Ives, a longtime Tesla bull and managing director of equity research at Wedbush, said in a research note on Thursday.
However, investors shouldn’t overlook its outlook for sales and profit. A sign of the weakening demand: Tesla has announced a rare sale. The company offered two rebates for buyers who take delivery of a vehicle before the end of the year, initially offering a $3,750 discount earlier this month. Tesla then doubled that rebate to $7,500.