Elon Musk’s Tesla, with its flagship factory in Fremont and engineering headquarters in Palo Alto, is experiencing one of its worst months in history. Key sales markets are weakening, loyal fans and influencers are turning away, and even customers are facing criticism. Meanwhile, a competitor has announced a major breakthrough. Investors, who once valued Tesla like a tech company rather than a traditional automaker, wiped out hundreds of billions of dollars from its market cap in February and early March.
J.P. Morgan auto analyst Ryan Brinkman highlighted the severity of the situation in a March 12 note, stating, “We struggle to think of anything analogous in the history of the automotive industry, in which a brand has lost so much value so quickly.”
Adding to Tesla’s troubles, the National Highway Traffic Safety Administration on Thursday disclosed another setback. The company is recalling nearly 46,096 Cybertrucks—essentially every unit sold—due to a defect where an exterior panel, attached with structural adhesive, can fall off. This marks the vehicle’s eighth recall since its late-2023 debut.
However, Tesla’s challenges extend beyond its vehicle issues. Much of the backlash stems from Musk’s political activities. Since President Donald Trump’s second term began in January, Musk has actively pushed for drastic changes in Washington, D.C., which has alienated many on the left. As a result, Tesla has become a target for critics. High-profile figures like singer Sheryl Crow and Senator Mark Kelly have publicly distanced themselves from the brand. Protesters have staged demonstrations at Tesla showrooms, while some activists have attempted to pressure owners into selling their cars. Reports of vandalism have also surfaced, prompting Trump to threaten domestic terrorism charges against perpetrators during a White House event alongside Musk.
Tesla’s declining reputation is also affecting its sales. In February, the company saw sharp declines in Norway, France, and Germany, according to The New York Times. In California, the largest U.S. market for electric vehicles, Tesla’s Model Y lost popularity toward the end of last year, Bloomberg reported. Additionally, YouTubers who previously praised Tesla seem to be pulling back from endorsing the brand.
But Tesla’s problems don’t stop at politics. The resale value of used Teslas is underperforming compared to other cars, raising concerns among potential buyers, Electrek reported. Meanwhile, China’s largest EV maker, BYD, recently announced a charging breakthrough, claiming its new technology can fully recharge a vehicle in just five to eight minutes—significantly faster than Tesla’s Superchargers. While BYD does not operate in the U.S., any market gains in China could mean further losses for Tesla.
By contrast, Tesla’s most notable recent win—a permit to operate robotaxis in California—seems minor in comparison to its broader struggles. While the company remains highly valuable, its signature no-gas vehicles once admired for their design and innovation are now facing a turbulent 2025.
Tesla did not respond to SFGATE’s request for comment.
