Tesla shares tumble as tariffs and competition bite harder
Tesla shares continue to fall, reaching their lowest level since the record rise in December. Losses are deepening after lower-than-expected delivery results for the first quarter and after analysts reduced price forecasts, reports Bloomberg, indicating brand issues related to Trump's policy.
Tesla shares experienced declines of over 10%, reaching a level of £172.50, which surprised even analysts who recently predicted increases. Commerce Secretary Howard Lutnick assured Fox News in March that the company's stock price "will never be this low again."
However, Bloomberg notes that these forecasts proved incorrect, and the declines continue. As Daniel Ives, an analyst at Wedbush Securities, observed, Donald Trump's trade policy, which results in tariffs, affects Tesla, and "the overall supply chain, and its global footprint, which has been a clear advantage over the years versus rising competitors like BYD."
The company's first-quarter results did not meet expectations. "We may have underestimated the degree of consumer reaction," stated Ryan Brinkman from JPMorgan Chase & Co., who lowered his forecasts for Tesla's future.
The declines in stock values are also the result of an impending crisis in the electric car industry, which follows Tesla's announcement that vehicle deliveries in the first quarter did not meet analysts' expectations. Ives also highlighted that Trump's tariffs could be particularly unfavourable for Tesla in China.
The backlash from Trump tariff policies in China and Musk’s association will be hard to understate, and this will further drive Chinese consumers to buy domestic such as BYD, Nio, Xpeng, and others – said the analyst.
Tesla's worst year
Tesla's deliveries in the first quarter of 2025 amounted to 337,000 cars, significantly below analysts' forecasts and the worst since 2022. The company did not meet market expectations, which anticipated 390,000 vehicles, and also recorded a decline compared to the first quarter of 2024, when it delivered 387,000 vehicles.
Additionally, the company's result was lower than that of Chinese competitor BYD, which sold 416,400 electric cars during the same period and regained the leading position in the market.
