Tesla shares extended their long run of declines in early Monday trading following a series of weekend protests targeting the EV maker and CEO Elon Musk and a fresh price target reduction from a top analyst on Wall Street.
Tesla (TSLA) shares have shed more than $700 billion in market value since their mid-December peak, and are set to open south of their Election Day close, amid concerns that Musk’s close tied to President Donald Trump, and his role in the administration’s cost-cutting effort, have eroded the EV maker’s global brand.
European registrations are free-fall, with declines of 76% in Germany, 55% in Italy and nearly 50% in Sweden, with many reports citing Musk’s politics as the principal headwind.
Tesla’s China sales, meanwhile fell 49% in February, an alarming slump when set against broader monthly gains for its domestic rivals, prompting a rare comment from China’s Passenger Car Association Secretary General Cui Dongshu that noted the “unavoidable risk” from Musk’s “personal glory”.
“As a successful businessman, one should be embracing 100% of the market: treat everyone nicely, and everyone will be nice in return,” Cui said. “But if you look at it in terms of voting, then half of voters will be friendly to you and half of them won’t be.”
In the United States, Tesla showrooms have become targets for activists protesting Musk’s role in firing tens of thousands of federal employees, with weekend “Tesla Takedown” protests reported in several major cities including New York and Chicago.
Elon Musk’s efforts to keep develop government relationships in China hasn’t prevented a notable slump in 2025 sales.
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UBS analyst Joseph Spak, who lowered his Tesla price target by $34, taking it to $225 in a note published Monday, sees the early sales declines hitting both first quarter delivery targets and full-year profit forecasts.
Softening Tesla demand
“Our UBS Evidence Lab data shows low delivery times for the Model 3 and Model Y (generally within 2 weeks) in key markets, which we believe is indicative of softer demand,” Spak and his team wrote.
Spak sees first quarter deliveries falling by as much as 26% from the thee months ending in December, and 5% from the same period last year, even with heavier promotions likely providing an end-of-quarter boost.
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That boost, however, will add further pressure to overall profit margins, with Spak forecasting a gross margin tally of 10.3%, down a full 3 percent from fourth quarter levels and 6 percent from a year ago.
First quarter earnings, Spak said, are likely to come in at 37 cents per share, “28% below consensus.”
He also cut his 2025 delivery forecast to around 1.7 million units, a 5% decline from last year that’s around 14% south of Wall Street’s consensus.
More margin pressures
“While we do expect the new ‘lower-cost’ vehicles to help volume, we also believe this may take some demand away from (the Model 3 and the Model Y), given out belief that this is a derivative off the existing platform,” Spak said.
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“Further, given that this vehicle is expected to be priced $5,000 to $7,000 below a (Model 3 or Model Y) and we don’t believe that amount of cost can come out of the vehicles, these new low cost vehicles are likely to be lower margin,” he added.
Tesla shares were last marked 3.4% lower in premarket trading to indicate an opening bell price of $253.75 each.
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