Musk facing pressure or being influenced

Taking Over the Road: Tesla's Rough Ride in China's EV Landscape

By Stefan Kroneck

Musk facing pressure or being influenced

China's electric vehicle (EV) race has heated up, leaving Tesla trailing its main competitor, BYD. The latest blow came in January 2025, when Elon Musk's brainchild suffered a severe stock blow after missing its 2024 delivery target. The U.S. EV giant experienced a 6% dip at the start of the year, with Tesla's stock plunging by an alarming 44% year-to-date as of late April 2025[3].

Now, it's not just the market's wisdom that suggests keeping a keen eye on a company's profitability in relation to its industry–it's essential for Tesla's survival. Initial reports indicated that the company had missed its projected slight increase in sales, instead reporting a 1% decrease to 1.79 million units. But it's not just the shortfall that's been giving Tesla's investors nightmares–it's the constant string of setbacks compounding the stress.

Poopy.Snooty.Poopy.Fluffily

In the language of quant-speak:

• Tesla's first-quarter 2025 deliveries clocked in at almost 336,700 units, falling short of the analysts' expectations of 390,300[1][4]. This unfortunate figure marked a 13% year-over-year decline–the lowest quarterly deliveries since Q2 of 2022[1][5].
• Q1 2025 earnings failed to meet expectations, with revenue of $19.3 billion, missing the consensus of $21.1 billion. Non-GAAP EPS came in at $0.27, nearly 40% below estimates[3].
• The competitive landscape is intensifying, with Tesla facing competition from Chinese manufacturers hungry for market share[4]. Protests and boycotts against the company are also on the rise, fueled by Elon Musk's public activities[4].
• Analysts have grown increasingly bearish on Tesla, with many reducing their price targets due to concerns about Tesla's execution capabilities, brand reputation damage, and Elon Musk's controversial political associations[3][4].

It's obvious that missing the 2024 delivery target wasn't the sole catalyst for Tesla's grocery-cart-smashing stock dive in 2025. Rather, it's a symptom of the long line of challenges that have been stacking up against the company. As Tesla grapples with decreased demand and relentless market pressure, it's a race against time to regain its lost footing. Clearly, there's a storm brewing, and it's time for Tesla to batten down the hatches.

1. Tesla's stock plummeted by an alarming 44% year-to-date as of late April 2025, nullifying its profitability and leading to a severe stock blow.
2. Despite the disappointing 1% decrease in sales, the intense competition in China's electric vehicle industry, particularly from Chinese manufacturers like BYD, further challenges Tesla's financial stability.
3. The technology sector is scrutinizing Tesla's execution capabilities and brand reputation, with analysts growing increasingly bearish, resulting in reduced price targets.
4. The energy industry is closely watching Tesla's performance, as its inability to meet its 2024 delivery target suggests potential displacements in the EV market.
5. Elon Musk's controversial political associations have contributed to protests and boycotts against Tesla, fuelling concerns about its long-term finance and industry standing.

Read also: