Tesla (TSLA) shares nosedived 15% on Monday, March 11, marking the company’s worst single-day performance since September 2020. The electric vehicle (EV) giant, which had already been struggling with a prolonged sell-off, has now seen its stock price tumble over 50% from its December 2024 high of $479.86, erasing more than $800 billion in market capitalization. This dramatic downturn has sent shockwaves through Wall Street and rattled investor confidence in one of the market’s most closely watched stocks.
Tesla’s Longest Losing Streak Since IPO
The latest plunge extends Tesla’s losing streak to seven consecutive weeks, the longest since its Nasdaq debut in 2010. The decline has been unrelenting since CEO Elon Musk took on a major role in President Donald Trump’s new administration. This involvement appears to have impacted investor sentiment, adding political uncertainty to Tesla’s already turbulent year.
Key Reasons Behind Tesla’s Stock Crash
1. Analyst Downgrades and Lower Delivery Forecasts
Tesla’s sharp decline on Monday followed a significant downgrade by UBS Group AG analyst Joseph Spak, who slashed his delivery estimates for the first quarter and full year. Spak now expects Tesla to deliver only 367,000 vehicles in Q1 2025—a 16% cut from his previous forecast. He also no longer anticipates Tesla surpassing last year’s sales, instead predicting a 5% annual decline in 2025.
Similarly, Ben Kallo of Robert W. Baird & Co. also reduced his Tesla delivery projections on March 6, further fueling concerns about the company’s ability to maintain growth amid increasing competition and supply chain challenges.
2. Weakening Demand and Brand Decline in Europe
Tesla’s struggles are not confined to the U.S. In Europe, Bank of America analysts reported that Tesla’s new vehicle sales plunged by approximately 50% in January compared to the previous year. The decline is partly attributed to falling brand appeal, as some potential buyers wait for the refreshed Model Y before making a purchase.
In Germany, Tesla’s vehicle registrations dropped by a staggering 70% in the first two months of 2025. This downturn coincided with Musk’s involvement in Germany’s highly contested federal election, raising concerns that political controversies are negatively impacting Tesla’s reputation in key EV markets.
3. Global Market Sell-Off and Trump’s Tariff Concerns
Tesla’s downfall also comes amid a broader stock market slump. The Nasdaq plunged nearly 4% on Monday, marking its steepest drop since 2022. Concerns over President Trump’s proposed tariff plans have added further pressure to the auto sector. Since Canada and Mexico are key markets for automotive suppliers, new tariffs could disrupt production and increase costs for manufacturers like Tesla.
4. Multiple Setbacks Across Musk’s Companies
Beyond Tesla, Elon Musk’s other ventures are also facing significant challenges. His social media platform, X (formerly Twitter), suffered multiple outages on Monday, adding to concerns about its long-term viability. Meanwhile, SpaceX is investigating back-to-back explosions that occurred during recent Starship rocket test flights. These setbacks have raised questions about Musk’s ability to effectively manage his growing portfolio of companies, adding to investor anxiety.
What’s Next for Tesla?
With Tesla shares now at their lowest levels in over a year, investors are left questioning whether this is a temporary setback or a sign of deeper structural issues. While some see the current dip as a potential buying opportunity, others remain cautious amid slowing demand, rising competition, and ongoing controversies surrounding Musk’s leadership.
As analysts continue to reassess their outlooks, Tesla’s stock remains under pressure. Investors will be closely watching upcoming vehicle delivery reports and company earnings for further insights into whether the EV giant can regain its momentum or if more turbulence lies ahead.
Stay tuned for more updates as the situation unfolds.
