When Elon Musk, the chief executive of Tesla, asked his followers on X last week whether it was time to create a new political party, 80 percent answered “yes.” Wall Street seems to disagree.

Tesla shares plunged 7 percent in early trading on Monday as investors registered dismay at Mr. Musk’s plans to form a third party and his intensifying feud with President Trump.

Mr. Musk’s involvement in politics and his financial support for the president’s campaign was once seen by investors as a benefit to Tesla, fueling a steep rise in company shares after the election last year.

That association has now turned into a liability. Tesla shares are down 40 percent from their peak in December.

The relationship between the president and Mr. Musk has been deteriorating since last month, when Mr. Musk criticized the president’s sweeping policy bill, which he said would bankrupt the nation as it swells the budget deficit. Mr. Trump signed the bill into law on Friday.

Even before that, Mr. Musk’s foray into politics had turned negative for Tesla. Mr. Musk’s support for Mr. Trump’s presidential campaign, and his endorsement of far-right politicians in Europe, had alienated liberals — who are most likely to buy an electric car — and contributed to falling sales.

Tesla said last week that it delivered 384,000 vehicles in the second quarter, down 14 percent from a year earlier.

The chances that Mr. Musk and Mr. Trump would reconcile, as some investors hoped, dimmed Sunday after the president said on Truth Social that Mr. Musk had gone “off the rails” with his plans for a so-called America Party. The president also called Mr. Musk a “train wreck.”

Mr. Musk reposted the president’s comments on X, the social media site he owns, without comment.