✅ Key Takeaways

• Tesla (TSLA) shares have plummeted over 50% in just three months, falling from a record high of $479.86 in December to $234.89 in pre-market trading.
• Elon Musk reassured employees during an all-hands meeting, calling the situation “a little bit of stormy weather”.
• Musk reiterated his long-standing claim that Tesla vehicles will soon be fully autonomous, despite years of delays.
• Tesla is pausing production of its Model Y to redesign the vehicle, contributing to delivery slowdowns.
• Political backlash and vandalism of Tesla showrooms and charging stations have added to the company’s challenges.

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📉 Tesla’s Stock Plunge and Market Reaction

Tesla Inc. (NASDAQ: TSLA) has seen its shares nosedive by over 50% since December 2024, leaving investors anxious.

• On Thursday, Tesla shares closed at $236.26, slightly up by 0.17%.
• In pre-market trading Friday, the stock dropped by 0.58% to $234.89.
• This represents a dramatic fall from the all-time high of $479.86 recorded on December 17, 2024.

✅ Investor Sentiment:

• The sharp decline has erased billions in market capitalization, raising concerns about Tesla’s growth trajectory.
• Commerce Secretary Howard Lutnick urged viewers on Fox News to buy Tesla shares, claiming: “It’ll never be this cheap again.”
• However, Lutnick’s comments sparked ethics concerns, as his statement could be interpreted as market manipulation.

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🔥 Elon Musk’s All-Hands Meeting: “Stormy Weather” and Self-Driving Claims

During a company-wide meeting broadcast on X, Musk sought to boost employee morale in light of the stock plunge.

• Musk joked about the media’s negative coverage, claiming: “If you read the news, it feels like Armageddon… I can’t walk past a TV without seeing a Tesla on fire.”
• He mocked detractors who have vandalized Tesla showrooms and vehicles, saying: “I understand if you don’t want to buy our product, but you don’t have to burn it down.”

✅ Full Self-Driving (FSD) Hype:

• Musk once again touted Tesla’s autonomous driving technology, claiming: “Teslas are an eventual software update away from self-driving.”
• Despite this bold claim, Tesla has yet to deliver fully autonomous capabilities, and Musk himself recently admitted he might be perceived as: “the boy who cried wolf.”

📉 Market Response:

• Investors have grown skeptical of Musk’s repeated self-driving promises, as Tesla has missed several autonomy-related milestones since 2016.
• Despite this, Musk urged employees to hold onto their stock, pausing for applause as he declared: “Hang on to your stock.”

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🚗 Production Pause and Delivery Slowdown

Tesla is facing delivery slowdowns and shipment declines in key markets, adding to its financial woes.

✅ Model Y Production Halt:

• Tesla temporarily paused production of its Model Y, its best-selling vehicle, to rework production lines and prepare for a redesigned version.
• This contributed to weaker delivery figures in the first quarter.
• Musk’s Defense: Despite the slowdown, Musk emphasized: “We actually literally make the best-selling car on Earth, of any kind,” referring to the Model Y’s global popularity.

✅ New Affordable Models Coming:

• Tesla plans to launch new, more affordable EV models in the first half of 2025.
• However, the company has provided little detail on these vehicles, creating uncertainty about their potential market impact.

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🛑 Political Backlash and Vandalism Concerns

Tesla is also facing growing political backlash, fueled by Musk’s close ties to former President Donald Trump.

✅ Vandalism and Protests:

• Tesla showrooms, vehicles, and charging stations in the U.S. and Europe have been targeted by protesters.
• The vandalism reflects rising anti-Musk sentiment, partly due to his involvement with Trump’s administration.

✅ Trump’s Support for Tesla:

• In response to the backlash, Trump arranged a parade of Teslas on the South Lawn of the White House.
• The move was seen as Trump’s show of support for Musk and Tesla amid political tensions.

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📊 Financial Impact and Investor Sentiment

Despite the stock slump, Musk remains optimistic about Tesla’s future, driven by:

• FSD (Full Self-Driving) progress.
• New, more affordable models.
• The strength of Tesla’s brand and customer loyalty.

✅ Wall Street’s Cautious Optimism:

• Analysts remain cautious about Tesla’s near-term outlook, citing:
  • Weakening delivery numbers.
  • Political and regulatory risks.
  • Production challenges linked to the Model Y redesign.
• However, long-term Tesla bulls view the recent price drop as a potential buying opportunity.

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🌎 Global EV Competition Intensifies

Tesla’s market dominance is being challenged by increasing competition from:

✅ Chinese EV Giants:

• BYD (Build Your Dreams) continues to gain market share, recently overtaking Tesla in global EV deliveries.
• NIO and Xpeng are also expanding aggressively, posing a threat to Tesla’s market position in China.

✅ Traditional Automakers:

• Volkswagen, Ford, and GM are ramping up EV production, introducing cheaper and more accessible models.
• This intensifies pricing pressure on Tesla.

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🚀 Future Outlook: Can Tesla Weather the Storm?

Tesla’s future hinges on its ability to:

• Deliver on Musk’s autonomy promises: Despite years of delays, FSD remains a cornerstone of Tesla’s growth narrative.
• Launch affordable EVs: The upcoming models will be key to regaining market momentum.
• Overcome political and regulatory challenges: Musk’s ties to Trump’s administration could further complicate Tesla’s public image.

✅ Long-Term Potential:

• Despite short-term volatility, Tesla remains a dominant EV player.
• The company’s focus on innovation and Musk’s vision for self-driving tech keep long-term investors interested.
• However, short-term risks, including tariff policies, political backlash, and delivery slowdowns, could pressure the stock further.

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🚦 Conclusion: Tesla Faces a Rocky Road Ahead

Tesla’s sharp stock decline and production challenges have raised concerns about the company’s future growth.

• Musk’s reassurances during the all-hands meeting aimed to boost employee morale, but investor confidence remains shaky.
• With increasing competition, political risks, and delivery slowdowns, Tesla faces a challenging road ahead.

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