Tesla Stock Extends Losing Streak Amid Global Sales Decline

ByMoneyReign

Tesla shares tumbled nearly 5% on Monday, continuing a historic losing streak as the electric vehicle manufacturer faces mounting concerns about weakening sales across global markets and deteriorating brand perception. The stock fell to $238 per share in late afternoon trading, underperforming significantly while the broader market showed signs of recovery, with the S&P 500 gaining 1%.

Monday’s decline marks the potential ninth consecutive week of losses for Tesla’s stock—the longest such streak in the company’s history. According to Forbes, Tesla was the worst-performing stock among all S&P 500 companies valued at $100 billion or more, highlighting the severity of investor concerns about the company’s near-term prospects.

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Mizuho Slashes Forecasts

The latest sell-off was triggered by a Sunday note from Mizuho analysts led by Vijay Rakesh, who significantly reduced their price target for Tesla from $515 to $430. More concerning for investors was Mizuho’s dramatic cut to its 2025 vehicle delivery forecast, slashing expectations from 2.3 million to 1.8 million vehicles—a reduction of more than 20% that falls well below the Wall Street consensus of 2 million deliveries.

Mizuho attributed Tesla’s “sales woes” to several factors, including weakening brand perception in the United States and European Union, deteriorating geopolitical conditions, and intensifying competition from domestic electric vehicle manufacturers in China. “We believe Tesla’s sales woes are the result of a deterioration in geopolitics, brand perception (U.S./EU), share loss due to stronger competition (China), and softer-than-expected demand for the Model Y refresh,” Rakesh wrote, according to Barron’s.

Troubling Sales Data

The analyst note highlighted concerning trends in Tesla’s key markets. According to Mizuho’s data, Tesla’s U.S. sales declined 2% year-over-year last month, even as the broader electric vehicle market grew by 16%. The situation appears even more dire in international markets, with reported sales plummeting 49% in China despite an 85% expansion in the country’s overall EV market. In Germany, Tesla sales reportedly collapsed by 76% while the nation’s EV market grew by 31%.

Tesla’s current struggles represent a dramatic reversal from its post-election rally, which saw the stock surge from approximately $250 to $490 between early November and mid-December 2024. That rally was fueled by investor optimism that Donald Trump’s return to the White House would benefit Tesla through favorable regulatory policies, particularly regarding autonomous driving technologies.

Musk’s Political Profile Affects Brand

Tesla’s decline coincides with CEO Elon Musk’s increasing political visibility and his close relationship with President Trump. JPMorgan analysts recently described the situation as unprecedented, writing, “We struggle to think of anything analogous in the history of the automotive industry, in which a brand has lost so much value so quickly,” particularly in markets where Musk has inserted himself into right-wing politics.

A CNN poll published last week revealed that approximately 53% of respondents hold a negative opinion of Musk, compared to only 35% with a positive view. This deteriorating public perception appears to be translating directly into sales challenges for Tesla, despite the company’s continued technological leadership in the EV space.

Tariff Tensions Create Additional Pressure

Ironically, while Musk maintains a close alliance with President Trump, the administration’s aggressive tariff policies may be creating significant headwinds for Tesla. The company recently lobbied the Office of the United States Trade Representative to adopt a “phased approach” on tariffs, acknowledging that Tesla vehicles contain “certain parts and components” that are “difficult or impossible to source within the United States.”

The plea for tariff flexibility highlights the complex challenges facing Tesla as it navigates both production constraints and shifting political landscapes that directly impact its global business operations.

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Valuation Impact

The extended stock decline has significantly affected Musk’s personal wealth, which has fallen by more than $130 billion from its December peak of $464 billion when Tesla traded at approximately $480. Despite this reduction, Musk remains the world’s richest person with a net worth estimated at $329 billion.

For Tesla investors, the current decline represents a sobering 41% year-to-date loss, making it the second-worst performing stock in the S&P 500 during 2025. The company has joined several other major financial institutions, including Goldman Sachs, JPMorgan, and UBS, in slashing delivery forecasts for the year.

Despite the ongoing challenges, many analysts maintain long-term optimism about Tesla’s prospects. RBC analyst Tom Narayan noted that the Model Y changeover explains part of the weakness, as sales typically decline when buyers await upgraded versions. Narayan maintains a Buy rating with a $440 price target, with approximately 57% of that valuation attributed to AI-trained self-driving capabilities rather than the company’s traditional automotive business.

As Tesla approaches the planned launch of its autonomous robotaxi service later this year, investors will be closely watching whether technological advancements can overcome the current challenges in the company’s core automotive business.

MoneyReign

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