Tesla’s future appeared bright following Trump’s victory, yet the automaker has stumbled significantly in 2025. The electric vehicle (EV) leader has recently encountered protests, vandalism, declining sales, and a sinking stock price. However, there are some potential positive developments on the horizon, including the launch of its robotaxi and the beginning of production for a more affordable EV.
The new year commenced with a shocking event when a man detonated a Cybertruck outside the Trump International Hotel in Las Vegas. This incident might feel like a distant memory now, given the continuous battles Tesla has faced. Just three months into the year, the situation has deteriorated to the point where President Trump has publicly defended CEO Elon Musk, condemning the escalating calls for a Tesla boycott and pledging to purchase a brand-new vehicle during a photo op at the White House.
This represents a striking turnaround from November, a time when Musk actively campaigned for Trump. Back then, Tesla’s prospects looked promising—stock prices were soaring, and Musk was appointed to spearhead the White House’s DOGE initiatives. Investors had high hopes as Musk pushed for an expedited federal approval process for fully autonomous driving, one of Tesla’s significant goals.
However, since the beginning of 2025, Tesla has been ensnared in political controversy, with particularly strong backlash from leftist groups. The automaker faces declines across several crucial metrics, compounded by the threat of impending tariffs. Nationwide anti-Musk protests and boycott campaigns have emerged, leading to vandalism incidents, including gunfire aimed at Tesla showrooms and vehicles, and arrests linked to acts of arson involving a Tesla supercharger station.
The backlash has left some Cybertruck owners feeling uneasy about leaving their vehicles unattended, while others have sold their cars out of embarrassment or fear of harassment. Some have even requested enhanced safety features for their vehicles, such as an AI-powered Sentry Mode.
Musk downplayed the protests during a recent CPAC address, claiming the demonstrations had “hardly any people” and lacked “popular support.” However, as vandalism against Teslas has persisted, Musk responded to a video showing stickers placed on the vehicles, calling such actions “vandalism” and not a form of free speech. Meanwhile, Trump has expressed a willingness to label attacks on Tesla dealerships as domestic terrorism.
In terms of financial health, Tesla’s stock has suffered significantly. The share price has fallen nearly 40% since the year’s start, and some analysts are raising alarms about the rapid loss of value in the automotive sector. Sales reports reveal significant drops in key markets: down 71% year-over-year in Australia and 76% in Germany. Sales in other countries like Norway, Denmark, Sweden, and France have also seen steep declines.
In the U.S., Musk’s political involvement has garnered praise from conservatives while drawing criticism from the left, with January sales dropping 11% year-over-year. Nevertheless, the Model Y remains a popular choice, and Tesla retains an estimated 42% market share of U.S. EV sales.
Tesla also faces fierce competition in China, where its manufacturing numbers decreased by 49% year-over-year, coinciding with substantial gains for local rival BYD. Additionally, looming tariffs pose a significant threat, potentially affecting Tesla’s margins and profitability.
Despite these challenges, Tesla is gearing up for two major launches in 2025 that have investors hopeful. The company plans to introduce a refreshed version of the Model Y and is set to roll out its “more affordable” vehicle in the first half of the year—key developments that could aid in retaining market share amid declining sales.
Musk’s increased involvement in politics has raised concerns about whether he is overstretched, especially as he balances his responsibilities across different companies. Nonetheless, investors remain hopeful, aware of Musk’s track record of successful turnarounds. The coming months will be critical as investors look to see if Musk can navigate through this tumultuous period for Tesla.
