Tesla Short Sellers Make $1.4B in Profits on the Stock Price Crash, Musk's Net Worth Drops $15.3B

Tesla (NASDAQ:TSLA) stock price fell 6.79% on Monday to £216.50 ($293.94) per share after CEO Elon Musk announced his plans to form a political party. Musk's decision to retain a political role despite investor concerns over Tesla's future, combined with an ongoing clash with US President Donald Trump over the 'One Big Beautiful Bill,' are among the factors that led to a drop in the EV maker's stock price.

Short sellers who bet against Tesla are expected to make profits of almost £1.03 billion ($1.4 billion) from the latest stock price decline, according to analytics firm Ortex.

In early June, Tesla short sellers reportedly made £2.94 billion ($4 billion) in profits after the stock price nosedived due to Musk's social media feud with Trump. Tesla shares are down 27.21% year-to-date as the company faces a range of hurdles around leadership, demand, and regulations.

The steep fall in the stock price resulted in Tesla losing over £50 billion ($68 billion) in market cap in a single day. 'The company is set to lose more than $80 billion in market valuation if current losses hold,' equity analyst Jed Dorsheimer reportedly told Bloomberg.

The latest stock price decline also impacted Musk's net worth. He reportedly lost £11.2 billion ($15.3 billion) yesterday, and his wealth has tanked by over £63.3 billion ($86 billion) year-to-date. At present, Musk's net worth is £254.8 billion ($346 billion), according to the Bloomberg Billionaires Index.

The company's profits and deliveries hit multi-quarter lows. Tesla recently posted that its electric vehicle deliveries fell 13.5% year-over-year in Q2. Model Y crossover and Model 3 sedan deliveries fell 11.5% YoY, while Cybertruck deliveries plunged by 51.8%. In May, Tesla sold less than 40,000 EVs in China as Warren Buffett-backed BYD continues to ramp up market share in the mainland.

The Wall Street Journal stated in a report that car buyers think Tesla EVs no longer appear as leading-edge as before. Trump's discontent with Musk's political plans is also impacting the Tesla stock.

'I am saddened to watch Elon Musk go completely "off the rails," essentially becoming a TRAIN WRECK over the past five weeks,' Trump recently wrote on Truth Social. 'He even wants to start a Third Political Party, despite the fact that they have never succeeded in the United States – The System seems not designed for them. The one thing Third Parties are good for is the creation of Complete and Total DISRUPTION & CHAOS.'

Wedbush analyst Dan Ives warned that the Tesla board might intervene at some point if Musk doesn't prioritise his company's growth strategy.

'Very simply, Musk diving deeper into politics and now trying to take on the Beltway establishment is exactly the opposite direction that Tesla investors/shareholders want him to take during this crucial period for the Tesla story,' according to Ives. 'There is a broader sense of exhaustion from many Tesla investors that Musk keeps heading down the political track.'

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