Tesla's Tumultuous Times: Stock Slumps, Sales Struggles, and Scandals Rock Elon Musk’s EV Empire

 

Once a Market Leader, Tesla Now Faces Investor Uncertainty, Activist Backlash, and Declining Sales

For years, Tesla thrived under the leadership of Elon Musk, a visionary yet controversial figure. However, a combination of political entanglements, financial turbulence, and intensifying competition has cast a shadow over the company’s future. Once the undisputed leader of the EV market, Tesla is now grappling with declining sales, plummeting stock value, and increasing public scrutiny.

Here’s a breakdown of the latest challenges facing Tesla in 2025.

1. Tesla Stock in Freefall

Tesla shares surged following Donald Trump’s 2024 election victory, hitting an all-time high in mid-December. However, the momentum was short-lived. Since then, Tesla’s stock has nosedived by nearly 50% from its December peak, leaving investors rattled. Analysts cite Musk’s polarizing political stances and growing competition in the EV space as key reasons for the downturn.

2. A Target for Protests and Vandalism

Musk’s political affiliations and social media presence have sparked widespread backlash. Protests outside Tesla showrooms, organized by groups like “Tesla Takedown,” have called for global boycotts of the company. Meanwhile, Tesla dealerships, charging stations, and even individual cars have been subject to vandalism and arson attacks across the U.S., Canada, and Europe.

• March 4: Several Tesla charging stations set ablaze outside Boston.

• March 17: Molotov cocktails used to ignite Tesla vehicles at a service center in Las Vegas.

• March 18: 80 Tesla vehicles vandalized in London, Ontario.

• March 2: A dozen Teslas torched at a dealership in Toulouse, France.

Despite speculation that the attacks may be coordinated, no concrete evidence has emerged. The Trump administration has since vowed to crack down on vandalism against Tesla properties.

3. Sales Plummet Amid EV Boom

Despite the overall rise in EV adoption, Tesla’s sales continue to fall. In February, Tesla’s registrations dropped significantly across major markets:

• U.S.: Declining sales for months, despite Tesla still leading the EV sector.

• Europe: A drastic drop in sales, except in the U.K.

• China: Sales plummeted by nearly 50%, according to the Passenger Car Association.

Tesla’s struggles contrast with the success of competitors like BYD, Rivian, and legacy automakers rolling out new EV models.

4. Financial Red Flags: $1.4 Billion in Missing Assets

A recent Financial Times investigation found a $1.4 billion discrepancy in Tesla’s financial statements. Between Q3 and Q4 of 2024, Tesla reported $6.3 billion in capital expenditures, but only $4.9 billion in property value increases. While there’s no direct evidence of financial misconduct, the lack of transparency has raised eyebrows among investors.

5. Cybertruck Hype Fades, Recalls Mount

Tesla’s highly anticipated Cybertruck has failed to maintain momentum. Despite being the best-selling electric truck in the U.S., sales dropped 32.5% between January and February 2025. Even with incentives like tax credits and financing deals, demand remains weak.

Meanwhile, Tesla issued yet another recall for the Cybertruck in March, affecting over 46,000 vehicles due to exterior trim panels that could detach mid-drive. This marks the eighth recall since its late 2023 launch.

6. Resale Value of Teslas Plummets

Used Tesla prices are depreciating at an alarming rate. According to CarGurus:

• Overall Tesla depreciation rate: -7.26% (three times faster than the industry average).

• Cybertruck: -58% year-over-year.

• Model 3, Y, S, and X: -6.3% to -13.6% drops.

The sharp decline in resale value is causing concerns among existing Tesla owners, some of whom are trading in their vehicles for non-Tesla alternatives.

7. Trump’s Tesla Endorsement Fails to Boost Sales

Following a historic stock sell-off, Donald Trump attempted to bolster Tesla’s reputation by purchasing a Model S and promoting the brand at the White House. The move, which included a live-streamed event on Musk’s social media platform, was widely criticized as an ethics violation.

Trump later claimed his endorsement could double Tesla’s sales, but so far, no evidence supports that assertion.

8. Tesla’s Public Image Takes a Hit

Polling data from YouGov shows that Tesla’s brand perception in the U.S. is at an all-time low:

• Among liberals: -35 (negative perception).

• Among moderates: -9.

• Among conservatives: +7 (the only demographic where Tesla remains favorable).

Tesla’s once-loyal fanbase appears to be shrinking, with longtime supporters expressing frustration over Musk’s political distractions.

What’s Next for Tesla?

Despite its current struggles, Tesla remains a major force in the EV industry. However, the company must navigate mounting competition, political controversies, and declining consumer confidence.

For Tesla to regain its dominance, it may need to shift its focus back to innovation, repair its damaged brand image, and address growing concerns among investors and customers alike.

Tesla’s recent challenges mark a dramatic shift from its years of dominance in the EV space. While the company has weathered downturns before, the combination of political entanglements, declining sales, and financial uncertainties could present its biggest test yet.

Will Tesla bounce back, or is this the beginning of a long decline? The coming months will be crucial in determining the future of Musk’s EV empire.