Tesla’s Troubles Are Deepening

One of the global leaders in the electric vehicle market, Tesla, is currently experiencing the most challenging period in its history. Political conflicts, declining sales, and strategic mistakes are posing serious threats to the company’s stability.

Tesla reported a 13% drop in global sales for both the first and second quarters of this year — the largest two-quarter decline in the company’s history. With demand falling in Europe, the U.S., and Asia, competitors — especially China’s BYD — are rapidly expanding their market share. BYD is expected to surpass Tesla in global sales by the end of 2025.

In the U.S., due to recently signed legislation, the $7,500 tax credit for electric vehicle buyers has been revoked. Additionally, environmental penalties for gasoline car manufacturers have also been eliminated. This is a significant loss for Tesla, as the company has earned $10.6 billion since 2019 by selling regulatory credits to other automakers.

With this revenue stream gone, Tesla’s profits have plummeted. In the first quarter of 2025, net profit fell by 71%. Without those credits, the company would have been operating at a loss again.

Elon Musk links Tesla’s future to autonomous robotaxis and AI-based robots. However, these technologies have yet to be introduced to the general public. The robotaxi service launched on a trial basis in Austin, Texas, still has safety drivers behind the wheel.

Meanwhile, competitor Waymo (a Google-owned company) has already rolled out a large-scale robotaxi service in cities like San Francisco, Los Angeles, and Phoenix. The company plans to expand to Miami and Washington in 2026.

Elon Musk recently announced the formation of his new political party. This move raised concerns among investors. Now openly feuding with his former ally, U.S. President Donald Trump, Musk is facing bipartisan political pressure. Analysts describe this as “self-sabotaging the brand.”

Investment banks, including William Blair, have downgraded Tesla’s future earnings forecasts and moved the company’s stock to a “neutral” rating. According to analysts, at a time when strategic focus is critical, Musk’s political involvement is becoming a major obstacle to Tesla’s growth. Read 'Zamin' on Telegram!