Tesla Stock is Struggling

Tesla’s stock is struggling to launch a sustained recovery, as new data on weak European sales add to the company’s mounting challenges.

The electric vehicle giant’s stock price dropped 8.4 percent over the course of Tuesday’s trades, according to Yahoo Finance, and was trading at $299.19 per share at the time of writing on Wednesday morning.

Newsweek has reached out to Tesla and will update this article if a response is received.

Why It Matters

It has been a tough start to 2025 for Tesla, one of the world’s most widely held stocks, whose price has fallen around 25 percent in the year-to-date, per Yahoo Finance, and around 29 percent since the inauguration of Donald Trump.

Its recent decline has been attributed to, among other things, the company chief’s role in the U.S. administration, successive reports of weak sales outside the U.S, and increasing competition from foreign rivals.

What To Know

The company enjoyed a sustained upward trend following Trump’s election, with the stock peaking at just under $480 in mid-December, contributing to a 50 percent increase over the past 12 months. However, its 2025 decline has wiped billions off Tesla’s valuation, pushing it out of the $1 trillion club for the first time since November.

Tuesday’s slump coincided with the release of new data on vehicle registrations in Europe indicating poor Tesla sales on the continent.

According to the European Automobile Manufacturers’ Association, Tesla sales across the European Union, European Free Trade Association and United Kingdom fell to 9,945 last month from 18,161 in January, 2024. The 45 percent drop—accompanied by a decrease in its market share from 1.8 to 1.0 percent—came despite sales of battery electric vehicles growing by more than a third (34 percent) over the same period.

The latest figures follow similar reports of slumping sales in Europe, as well as the Asia-Pacific region, and compound the issues already facing the company.

As indicated by the decline in its European market share, Tesla is facing competition from rivals such as Volkswagen, as well as those in China such as SAIC Motor.

Shenzhen-based BYD Auto has been closing in on Tesla recently, overtaking the company in U.K. sales for the first time last month, according to data from the Society of Motor Manufacturers and Traders, while also rolling out inexpensive self-driving features that have long been central to Tesla’s future strategy.

Analysts also worry that CEO Elon Musk‘s involvement in the Trump administration may be distracting from what Tesla shareholders likely view as his more pressing priorities. Alongside his other political ventures—such as voicing support for far-right parties across Europe—this could alienate Tesla’s customer base, which polling suggests leans to the left.

Art Hogan, chief market strategist at B. Riley Wealth in Boston, told Reuters: “He’s a very hands-on operator, and if you’re spending that much time in an office in the White House, how much time are you spending running all of your other companies, including the one that’s publicly traded?”

Some owners are reportedly selling their Teslas or canceling new orders in response to Musk’s political activities, with polling suggesting that many prospective buyers have been put off the brand for the same reason, instead opting for foreign-made alternatives.

What People Are Saying

In a February 12 note shared with Newsweek, Wedbush Securities analysts said: “The worry of the Street is that Musk dedicating so much time (even more than we expected) to DOGE takes away from his time at Tesla in such a crucial moment and year for the company. The autonomous and robotics battle for market share is in full force both in the US and China and many on the Street view Musk spending ‘100% of his time’ with DOGE as creating a negative perception around his Tesla focus.”

“In addition, Musk’s DOGE related actions and more powerful alliance with Trump clearly could alienate some consumers to move away from the Tesla brand,” they added. “There is some momentum around this effort in Europe and pockets of the U.S. as well since November.”

CFRA stock analyst Garret Nelson said earlier this month: “We remain bullish on Tesla, Inc. because we’re optimistic as far as regulatory approvals and getting a regulatory framework related to autonomous driving in the United States. I think that will come sooner rather than later. On our view, [Tesla] is still trading at a fraction of the market opportunity here, which we estimate to be north of $5 trillion.”

What Happens Next?

Many analysts are still bullish on Tesla, and are doubling down on their investments in the belief that the company’s fundamentals will result in upward movement in the longer term.

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