Shares in Tesla tanked by as much as 7.6% in premarket trading Monday after its CEO Elon Musk said he is forming a new American political party, provoking an irate response from US President Donald Trump.

President Donald Trump on Sunday called Elon Musk's plans to form a new political party "ridiculous," launching new barbs at the tech billionaire and saying the Musk ally he once named to lead NASA would have presented a conflict of interest given Musk's business interests in space.

CNBC's Steve Sedgwick, Karen Tso and Julianna Tatelbaum discuss Tesla CEO Elon Musk's plans to form a new political party. Musk's announcement has drawn the ire of U.S. President Donald Trump.

President Donald Trump blasted Elon Musk’s bid to start a new political party, as the intensifying feud between the former allies deepens concerns among investors over the implications for Tesla Inc.

President Donald Trump dismissed Elon Musk’s plan to launch a new political party, calling it “ridiculous” and insisting the U.S. remains a “two-party system.” “Third parties have never worked, so he can have fun with it,