Tesla’s rough ride on Wall Street continued on Monday, as the stock plunged nearly 5% to $238 per share, marking its worst start to the week in months. The EV giant ended Friday at its lowest weekly close since the 2020 election, and the latest drop came despite a 0.7% rise in the broader S&P 500, which notched its highest close in 10 days.
Tesla Underperforms the Market Yet Again
Among the 100 largest S&P constituents valued over $100 billion, Tesla was the day’s worst performer, according to FactSet. The slump followed a bearish note from Mizuho analysts, who slashed their price target by $85 to $430. Despite the lower target, Mizuho’s forecast still reflects a bullish outlook, but the firm’s reduced 2025 delivery estimates sent shockwaves through the market.
Delivery Forecasts Take a Major Hit
Mizuho now expects 1.8 million deliveries in 2025, down from its previous estimate of 2.3 million—a more than 20% cut and significantly below the 2 million consensus forecast. The downgrade reflects weakening brand perception in the U.S. and EU, along with mounting competition in China from domestic EV makers.
Tesla Sales Decline as Global EV Market Grows
The disappointing forecast comes as Tesla’s sales are shrinking in key markets, even as the broader EV sector continues to expand:
- U.S. Sales: Down 2% year-over-year in February, while the U.S. EV market surged 16%.
- China Sales: Cratered 49%, despite China’s EV sector growing 85%.
- Germany Sales: Tanked 76%, while the German EV market expanded 31%.
Wall Street Analysts Turn Bearish
Tesla’s woes are drawing increasing skepticism from Wall Street heavyweights. JPMorgan, Goldman Sachs, and UBS have all lowered their delivery forecasts, citing deteriorating sales and growing competition. JPMorgan analysts recently stated that Tesla’s brand value is eroding at an unprecedented pace, calling it “one of the fastest declines in automotive history.”
Musk’s Political Ties Add More Pressure
Elon Musk’s public alignment with right-wing politics, particularly in Germany and the U.S., has further alienated potential customers. Though Musk is seen as a close ally of Donald Trump, the former president’s hawkish tariffs are hurting Tesla’s profits. In a letter to the U.S. Trade Representative last week, Tesla lobbied for a “phased approach” on tariffs, claiming that many of its EV components are “difficult or impossible to source” domestically.
Musk’s Popularity Plummets
Adding to the turmoil, a CNN poll published last week revealed that 53% of respondents hold a negative opinion of Musk, compared to 35% with a favorable view. The billionaire’s polarizing public persona is raising concerns about its impact on Tesla’s brand and sales.
