Tesla achieved its most significant sales decline in history when first-quarter vehicle deliveries dropped by 13% this year. During this period Tesla managed to sell 336,681 cars, although it missed its yearly target by 50,000 units. The brand faces its biggest quarterly sales decrease in the past three years due to market competition and ongoing political controversies involving CEO Elon Musk.
The company faces difficulties because of public demonstrations that have damaged Tesla facilities. Critics strongly oppose the partnership between Musk and the Department of Government Efficiency and the Trump administration. The company avoided mentioning these production issues in its sales announcement but noted the Model Y production stoppage that affected all four of its factories.
The stock market value of Tesla dropped by 44% after reaching its highest point in December following the previous presidential election due to Musk’s political connections. The stock price showed a minor recovery following reports that suggested Musk would reduce his involvement with the Trump administration. The analysts continue to worry that Tesla faces damage to its corporate image due to Musk’s outspoken public behavior.
According to a CNN survey, the public approval of Musk has reached an all-time low of 35%, while liberals specifically show increasing negative sentiments toward him. The negative public perception of Tesla has grown since 2021 because 32% of U.S. consumers now reject Tesla vehicles, whereas only 17% did before.
The Chinese EV manufacturer BYD, along with other Chinese competitors, has stepped up its rivalry against Tesla. The combination of BYD’s inexpensive vehicle lineup and superior charging systems has outpaced Tesla’s sales numbers, especially in China, which holds the position of being the largest EV market globally. Tesla faces the possibility of losing its position as the leading EV manufacturer to other competitors by 2025 based on current market trends.
Tesla stands at a crucial point in its development since political obstacles and market competition are rapidly growing.
