Tesla’s stock took a hit this past Monday, dropping about 7% to $243.36. Since last week, when it peaked at just under $300, it’s dipped nearly 15%. Several key factors are pushing the stock down.
First, there are concerns about auto tariffs. With a deadline looming, President Trump’s tariffs may impact Tesla, even though it primarily manufactures its vehicles in the U.S. Dan Ives, an analyst at Wedbush, pointed out that many U.S. auto parts still come from abroad. He mentioned, “Even U.S. automakers that produce in the U.S. use about 40%-50% foreign auto parts.” He argued that with these looming tariffs, Tesla might still be forced to raise its prices.
Additionally, public sentiment toward Tesla has soured. Recently, protests against Elon Musk and his company have surged. Over the weekend alone, it was reported that more than 200 “Tesla Takedown” protests occurred worldwide. In a notable demonstration in Ann Arbor, Michigan, nearly 400 people protested outside a Tesla showroom. The growing discontent can be traced back to Musk’s controversial role in the Trump administration, which has made many former supporters reconsider their views. A protester shared, “I was originally a big fan. Now, I’m concerned about his influence.”
In Italy, the tension escalated when a fire at a Tesla dealership destroyed 17 vehicles, leading authorities to investigate the cause.
On the financial side, analysts at Stifel have revised their price target for Tesla, lowering it from $474 to $455. Their report indicates that they are adjusting expectations for vehicle deliveries as Tesla works on launching its new Model Y, dubbed “Jupiter.” While they believe this new model will boost sales in the future, its rollout presents challenges in the short term.
Stifel also noted a drop in Tesla’s popularity among Democrats, a group more likely to invest in electric vehicles. This dip in favorability, combined with ongoing protests, could spell trouble for future sales. As Stifel remarked, “Damage to Tesla sites and customer-owned vehicles definitely poses a challenge.”
Meanwhile, a survey by the Pew Research Center in 2023 revealed that while interest in electric vehicles is on the rise, political affiliations increasingly influence consumers’ choices. This trend puts companies like Tesla in a complicated position, as public opinion can affect their market stability.
As the situation evolves, the future remains uncertain for Tesla. Consumer perception, political forces, and global trade dynamics will be critical factors in how the company navigates this challenging period.
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