Tesla stock is down 46% from its December 2024 high, according to CNBC, a $677 billion loss in stock market value.
That still leaves the company with $842 billion in market cap – 8.6 times Tesla’s 2024 revenue of $97.7 billion, according to Tesla’s 2024 Form 10K.
Does this drop in the stock price make the company’s shares a buy? After suffering its first decline in automotive sales in 2024, a 7.6% decline, the stock will surely rise if Tesla shipments grow faster than investors expect.
However, the stock’s headwinds are numerous – including the company’s relatively old models, vehicle quality problems, plunging resale values, and rivals offering improved technology, better battery range, and lower prices, according to the Wall Street Journal.
To be sure, Tesla has promised new models and robots, as I wrote in a January 2025 Forbes post. Since then, CEO Elon Musk’s role in the Trump administration has added more to the company’s woes.
How so? Once-proud Tesla owners are struggling to ditch their vehicles to escape the social opprobrium associated with Musk’s role in the Department of Government Efficiency, according to the New York Times.
Tesla did not respond to requests for comment from the Journal and the Times. I have contacted Tesla and will update this post if I receive a response.
Vehicle Sales Drop As Tesla’s Brand Erodes
While Tesla once enjoyed explosive growth, recently “monthly U.S. sales have seesawed between 50,000 and 60,000,” reported the Times.
The value of used Tesla’s has deteriorated considerably. Tesla accounted for four of the 20 used-car models with the largest drop in value for the year ending in January 2025, iSeeCars.com executive analyst Karl Brauer told the Times. At the top of the list was the Tesla Model 3 (with a 27.1% drop in value) and Model Y (down 21.9%), noted the Times.
Tesla’s popularity has plunged since 2022. That was before Musk’s foray into presidential politics, when 22% of car shoppers said they would “definitely consider” a Tesla for their next vehicle purchase, according to a Strategic Vision report featured by the Journal.
By the summer of 2024, that figure had dropped to 7%. “At this point, we don’t see any signs of recovery,” the firm’s president Alexander Edwards told the Journal. Tesla’s “historic appeal to environmentally minded buyers” is at odds with Musk’s politics, he added.
Musk’s DOGE Role Makes Some Tesla Owners Hurry To Sell
Some Tesla owners are moving quickly to replace their vehicles to avoid the shame of being associated with Musk’s “values and politics,” noted the Times. Here are four examples:
- Tesla Model Y owner Jennifer Trebb sold her $55.800 2023 Model Y for $23,800 less than she paid for it. Two weeks ago she was called a “Nazi” in a Kroger’s parking lot prompting her to tell her husband, ‘That’s it. I’m done,” she told the Times.
- Gold Cybertruck Owner Dr. Kumait Jaroje plans to sell his $113,000 gold Cybertruck which he used to advertise his cosmetic medical practice by placing a decal on its side. After the inauguration, someone put an obscene bumper sticker on the vehicle and his practice got “an influx of negative reviews online,” he told the Times.
- Model X Owner Garth Ancier told fellow Tesla customers, he felt like he was driving “a big red MAGA hat,” reported the Journal. Ancier blames Musk’s conduct for his desire to sell the 4-year-old vehicle. “If not for his behavior, I’d probably stick with a Tesla,” he added.
- Cybertruck customer Larry Broughton decided to cancel his order for the two cybertrucks. “As soon as he started doing all this stuff that Trump wanted him to do, I didn’t want to be a part of it,” Broughton told the Journal.
Tesla’s Global Sales Decline
Tesla’s drop in worldwide deliveries last year was at odds with explosive growth in the rest of the industry – which enjoyed a 25% sales increase, the Journal noted. In the U.S., Tesla sales fell 7% in 2024, and by 2% in the first two months of 2025, Wards Intelligence estimates.
Decline in Tesla demand abounds in Germany, France, and China. New-vehicle registrations for Tesla were down 76.3% in Germany, 26% in France, and 49% in China last month, according to government and industry association data featured by the Journal.
It takes years to build a reputation and far less time to destroy it. With help from Tesla employees and the EV community, Tesla became a popular EV brand. “A deep social media addiction, purchasing of Twitter, a move into politics, a few salutes, and now most of that incredible work is gone,” concluded EV news site Electrek.