Tesla’s stock is plummeting, and some investors are reported to be gearing up for even tougher times ahead. The electric vehicle giant, helmed by Elon Musk, has seen its shares tumble roughly 40% from their peak in late 2024. The slide picked up speed recently after reports revealed a near 50% drop in European car sales for January, with this week alone shaving about 17% off the stock price. For a company long fueled by investor hype as much as its actual performance, this signals growing unease about its core auto business slowing down.
Elon Musk’s preoccupation with politics has also reportedly worried investors who would like to see him spend more time running the EV maker. To make matter worse, critics of Donald Trump and Elon Musk hope to discourage and stigmatize purchases of Tesla. Liberal groups for weeks have organized anti-Tesla protests in hopes of galvanizing opposition to Musk's Department of Government Efficiency (DOGE). Musk is taking direction from President Trump to slash federal spending and sharply reduce the workforce. Some Tesla owners have also reported their vehicles vandalized with spray painted swastikas amid what Jewish groups and observers fear is a rise in antisemitism.
Steve Sosnick, chief strategist at Interactive Brokers, told Bloomberg that the challenge of pinpointing a bottom for a stock like Tesla. “When a company’s valuation has defied traditional measures for so long, finding a floor depends more on investor mood than typical value metrics,” he said.
The hits have come fast in 2025. Tesla’s stock surged post-US election, riding optimism tied to Musk’s ties with President Donald Trump. But that fizzled in January as the company posted lackluster Q4 delivery figures, marking its first annual sales decline in over a decade. A subsequent earnings report revealed weaker-than-expected profits and a dimmer sales forecast for 2025, piling on the pressure.