Wedbush analyst Dan Ives wrote that the EV maker’s directors need to set ground rules for the CEO regarding his political activities.

Tesla shares sank Monday after CEO Elon Musk announced he would form a new political party in an escalation of his feud with President Donald Trump.

Musk has been able to play off Tesla's struggles for over a year now because the stock has been astonishingly resilient. Neither political gaffe nor falling deliveries has knocked Tesla off its upward trajectory, but Monday's selloff may be a sign of a changing sentiment.