Tesla’s stocks falling faster than SpaceX’s rocket boosters

Graphics: TBS

A few weeks ago, a sticker affixed to the back of a Tesla went viral. It read, "I bought this before Elon went crazy." On Amazon, sellers have flooded the marketplace with variations on the theme, and Tesla owners are snapping them up.

Some have gone further, peeling off the car's decals and plastering their bumpers with statements of disavowal. One sticker simply declares, "No Elon." Another reads, "Anti-Elon Tesla Club."

For years, Tesla was more than just a car company — it was a movement. Owning one signaled a commitment to a cleaner future, a belief in cutting-edge technology, and, for many, admiration for Elon Musk's unconventional genius.

But something has changed.

The long waitlists have vanished, and so has the once-ironclad loyalty of Tesla drivers. Across the world, Tesla showrooms are quieter than ever, while second-hand car dealerships are flooded with trade-ins.

For Tesla, a brand that once embodied innovation and sustainability, the shift in perception has been nothing short of seismic. It is a crisis of identity, fuelled not by technological failure but by the increasingly divisive and questionable actions of its CEO, Elon Musk.

From stock market tumbles to public protests, Tesla is facing the most turbulent period in its history. How did a company that once seemed destined to dominate the future of transportation find itself in freefall?

A political gambit gone wrong

For years, Elon Musk's personal brand had been inextricably tied to Tesla's success. He was the genius billionaire, the visionary who dared to dream beyond the boundaries of conventional automotive thinking.

The backlash has extended beyond lost sales. Tesla vehicles have become targets for vandalism. In Brooklyn, Cybertrucks were egged and smeared with graffiti. In Boston, Tesla charging stations were set on fire. In New Orleans, crowds at Mardi Gras booed and bombarded Cybertrucks with beer cans, beads, and spit.

But in recent months, Musk has become something else entirely: a deeply polarising political figure. His close alignment with Donald Trump's second administration, his controversial role as head of the so-called Department of Government Efficiency (DOGE), and his incendiary social media posts have alienated many of Tesla's original customer base.

This political turn has had tangible consequences. In Australia, Tesla sales plummeted 72% in February compared to the same period last year. In Europe, sales nearly halved. In China, once Tesla's second-largest market, January sales dropped 11%, while local competitor BYD surged ahead by 48%. The trend is clear — customers who once saw Tesla as a progressive brand are turning their backs on it.

Deep down into a crisis

The backlash has extended beyond lost sales. Tesla vehicles have become targets for vandalism. In Brooklyn, Cybertrucks were egged and smeared with graffiti. In Boston, Tesla charging stations were set on fire. In New Orleans, crowds at Mardi Gras booed and bombarded Cybertrucks with beer cans, beads, and spit.

The company has also become a rallying point for protest movements, most notably Tesla Takedown, which has organised demonstrations at Tesla showrooms worldwide, urging people to sell their cars and divest from the company.

Meanwhile, Musk's political entanglements have bled into Tesla's stock market performance. Since he formally joined the Trump administration, Tesla's stock has declined for seven straight weeks — its worst stretch since going public. On 10 March, shares fell sharply by 15% in a single day, erasing more than $800 billion in market value since December. Musk's personal wealth has taken a hit as well, shrinking by $141.5 billion since then.

The Tesla business model is falling apart

While Musk's politics have triggered a consumer and investor backlash, Tesla's underlying business challenges are exacerbating the problem. Sales dropped 1.1% in 2024 — the company's first decline since 2011.

Meanwhile, competition has intensified. BYD has overtaken Tesla as the world's top EV seller, while Volkswagen is now selling more electric vehicles than Tesla, except in China.

The much-hyped Cybertruck has proven to be a misstep. Derided for its awkward design and poor production quality, it has been recalled six times and has struggled to attract buyers. Tesla originally planned to sell 500,000 units annually but has so far managed just 10% of that target.

Even Tesla's long-promised Full Self-Driving (FSD) technology remains elusive, and competitors in China are offering similar driver-assist software for free — while Tesla continues charging thousands of dollars for an incomplete product.

Another blow came when Tesla scrapped plans for an affordable $25,000 Model 2. Instead, Musk is pivoting towards robotaxis and humanoid robots, promising that these futuristic technologies will drive Tesla's next wave of growth. But investors are losing patience. Tesla's valuation, which has long been propped up by optimism rather than performance, is beginning to look fragile.

Can Tesla recover?

Despite its current woes, Tesla is still the most valuable automaker in the world. Its $774 billion market capitalisation remains higher than that of the next five largest automakers combined. But this valuation is built on an uncertain future.

Musk insists Tesla is not just a car company but an artificial intelligence and robotics powerhouse. However, with sales declining, production issues mounting, and customers fleeing, the company's fundamentals are eroding.

Some analysts believe Musk's political affiliations will permanently damage Tesla's brand. Others argue that while Tesla may lose its eco-conscious consumers, it could gain a new customer base in conservative markets.

Whether that shift will be enough to offset its losses remains to be seen, but the one thing that is certain is Tesla's next chapter will be nothing like the one Musk originally envisioned.