Tesla 'free fall', Elon Musk's loyal fans also give up

Elon Musk has always had a loyal following for Tesla. But even the most steadfast investors have been falling away as the company's stock has plummeted.

Trump steps out of a red Model S in a batch of cars sent by Tesla to the White House on March 11. Photo: Bloomberg .

Tesla is the worst-performing stock in the S&P 500 index this year. The sell-off at the electric carmaker was so severe that on the evening of March 10, US President Donald Trump had to intervene.

Trump said he would buy a new Tesla to support Musk. On March 11, the president selected a red Model S from Teslas delivered to the White House. The company’s shares rose 3.8% for the day after falling 15% on March 10.

But even with the president’s endorsement and the rare opportunity to buy at the bottom, Musk loyalists are hesitant to jump in. They worry that the run is far from over.

Those who still support Musk

According to Bloomberg , Tesla shares have now lost 52% of their value from their all-time high in mid-December. All of the gains made after the election have been wiped out, while investors had hoped that Musk’s close relationship with the new president would benefit the company.

“Emotions are running high and the downside pressure is on. Tesla has room to fall further in the next 30-60 days,” said Brian Mulberry, portfolio manager at Zacks Investment Management. He said $200 or even lower is entirely possible in the short term.

Standing next to Elon Musk, President Trump described Tesla products as beautiful cars. Photo: New York Times.

Brian Mulberry isn’t alone in his caution. As the stock price fell below $230 this week, down from more than $400 less than two months ago, even Wall Street analysts are starting to grow more cautious. In the past week alone, at least four analysts have lowered their price targets on Tesla. Two others have warned of weak sales and negative sentiment.

One of the few remaining sources of support for Tesla’s stock is the group of retail investors who have been loyal to Musk. Retail investors have bought a total of $2.8 billion of Tesla shares since last week, according to Emma Wu, global quantitative and derivatives strategist at JPMorgan Chase & Co.

But even the most loyal are wavering. One of the most-viewed posts on Reddit for Tesla investors on March 11 read: “I’m still holding the stock, but I’m starting to question my decision.”

Tesla no longer has a support?

The biggest problem for Tesla right now is that there are no events or information that can help restore investor confidence, Bloomberg commented.

Tesla’s full self-driving (FSD) technology update or robotaxi project has no specific launch date. Meanwhile, Musk has been spending a lot of time on the Department of Government Efficiency (DOGE), which has raised concerns that he is too distracted and not focused enough on his electric car company.

The current US administration has also taken a tough stance on electric vehicles, creating a major barrier to domestic demand. Globally, Tesla’s situation is no better. A series of gloomy reports have come from China, Europe and Australia. In many places, Musk’s deep involvement in international politics is damaging Tesla’s brand image.

The situation is so bad that some analysts have lowered their sales forecasts for Tesla in the first quarter of 2025. On March 10, Joseph Spak of UBS warned that current profit expectations may be too high.

Just a few months ago, Tesla was the biggest beneficiary of Trump's election. Photo: New York Times.

The bearish sentiment on Tesla has been building since the beginning of the year, but the sell-off has really intensified in the past few weeks, according to Bloomberg . Uncertainty surrounding Trump’s trade policies and the risk of an economic recession are causing investors to abandon risky assets, including Tesla.

“Tesla has now become a test of the Trump market. Unless the market is willing to reward Trump and Musk for their efforts, the stock will continue to fall. There is no clear bottom in sight for Tesla stock right now,” said Adam Sarhan, founder of 50 Park Investments.

Just a few months ago, Tesla was the biggest beneficiary of Trump’s election, with its stock price up more than 90% in just over a month, despite the fact that the company’s business situation had not significantly improved.

Source: https://znews.vn/tesla-roi-tu-do-nguoi-ham-mo-trung-thanh-cua-elon-musk-cung-bo-cuoc-post1537608.html