Tesla is having one of its toughest years in recent memory. The company’s stock has dropped sharply in early 2025, and while some investors see opportunity, others are cashing in — specifically short sellers, who have made billions from Tesla’s decline. With Elon Musk under political and public scrutiny, questions are growing about the brand’s future, its leadership, and its resilience in an increasingly competitive EV landscape.
Tesla’s Market Slide Fuels $16 Billion in Short Seller Gains
Tesla’s stock has fallen more than 40% year-to-date, wiping out gains from late 2024. That dramatic drop has delivered a windfall to short sellers, who have reportedly gained around $16 billion in just a few months.
Short selling is a strategy where investors profit from a stock’s decline. In Tesla’s case, falling share prices — from near $480 at their peak to under $240 — have given hedge funds and short-focused investors a significant payday.
Musk’s Controversies Stir Investor Uncertainty
CEO Elon Musk has never shied away from public attention, but his recent comments and political involvement have reignited backlash. His appearance at major political events and controversial social media posts have drawn criticism across both sides of the Atlantic.