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Tesla stock [NASDAQ:TSLA] soared after Donald Trump was elected. Since then, Elon Musk has effectively become shadow president — like, almost literally if you watch the latest “press conference.” One would think that would be good for Tesla, right? Well, aside from all kinds of craziness and nonsense with this (and I’ll come back to some of that), Tesla is facing a number of challenges, and challengers.
Tesla Sales
Tesla sales dropped in 2024 compared to 2023. That was already well off of Tesla’s plans. Now, news has been coming out that sales dropped much more in January in market after market. That has probably spooked some investors.
The plan — or hope or hype — is that Tesla sales will rebound this year. The company is supposedly going to be introducing a new model or two, and the revamped Tesla Model Y is expected to sell very well. In fact, it could be people waiting for the new Model Y that is resulting in the sales drop, or part of it. Also, Elon Musk is set on Full Self Driving (Unsupervised) solving all of Tesla’s problems, stimulating sales growth again, raising gross margin again, and putting the company back on track for exponential growth to the moon! That’s the idea, and that may still be how it plays out, but it seems there is growing concern that’s more fantasy than reality.
Tesla is facing growing EV competition from other automakers. That’s been the case for a few years, but as the competition has grown and grown, and Tesla has been slow to expand its lineup with more popular models, Tesla as a “growth story” has started to sound like fantasy. Full Self Driving (Unsupervised) is supposed to be the savior, but as we wait for that, Waymo keeps expanding, other companies have launched driverless robotaxi services (in China), and now we have news that BYD is going to include advanced driver-assist features in all of its models, even the one that costs less than $10,000. It’s not at robotaxi capability yet, but what if BYD (and new AI partner DeepSeek) can get there in the next couple of years? What does that do to the value of Tesla Full Self Driving?
The Latest Tesla FSD Fail
It doesn’t help that Tesla’s latest and greatest version of FSD just drove a Cybertruck into a light pole. In fact, perhaps that’s also why the stock is dropping. Perhaps people are losing faith in the constant claims that FSD has gotten so much better and is close to robotaxi ready.
The Cybertruck apparently drove itself into a school drop-off lane at full speed, not realizing it should have edged to the left despite arrows clearly indicating that, and then didn’t notice the light pole in the middle of the lane until far too late.
BYD’s driver-assist system will include radar, as well as cameras. “[BYD’s] ‘God’s Eye C’ system has 5 high-precision millimeter-wave radar, 12 ultrasonic sensors, and 12 cameras… on a car that costs $9600 and includes the intelligent driving capability in that price,” Larry Evans notes. We’ve long been told radars are too expensive and complicated to include in Tesla’s FSD system, but radar probably would have prevented this Cybertruck from plowing into the light pole — even if it wouldn’t have fixed the Tesla’s lane selection process.
Tesla Board Issues
Then there’s also some recent controversy with the Tesla board of directors that may be at play. Tesla board members sold millions in stock last week, and this follows them paying the company back almost $1 billion in compensation last month. “The sales occurred after board members, including Kimbal Musk, agreed to pay a collective $919 million back to the EV maker to settle claims of excessive compensation,” CFO Dive writes. Tesla’s CFO, Kimbal Musk, and Chair Robyn Denholm sold tens of millions of dollars in Tesla stock last week. “The stock sales come after Denhalm, Kimbal Musk and other Tesla board members — including James Murdoch and Oracle co-founder Lawrence Ellison — recently agreed to collectively return roughly $919 million in compensation to Tesla in a Delaware settlement last month. The settlement followed a lawsuit alleging the directors had overpaid themselves, Reuters recently reported.” The report adds that “The directors did not admit wrongdoing,” but why are these people paying back nearly $1 billion if they didn’t do anything wrong?
Perhaps people are also losing faith in Tesla’s board as independent evaluators of Elon Musk’s work as CEO.
Elon Musk’s Susceptibility to Misinformation, False Assumptions, & Lack of Logic
Perhaps there were a number of signs previously that Elon Musk lacked proper logic or information on important matters he spoke about, like his claim that new COVID-19 cases would likely be close to zero by April 2020 (something that didn’t line up at the time with any of the science, and clearly ended up being false).
Rather than admit mistakes and work on ways to avoid the problem in the future, Musk has doubled down on gobbling up misinformation on X and spreading it far and wide. When you ask his own AI system, Grok, who was one of the biggest spreaders of misinformation about the last election, it tells you Elon Musk was.
In an extremely odd press conference in the White House yesterday, questions were peppered at Musk while Trump was hunched over at the desk and Musk was standing a bit behind him and to the side. When asked how it wasn’t a conflict of interest that Musk and his “DOGE” team were going to be investigating the Department of Defense for fraud, since SpaceX gets contracts from the Department of Defense (DoD), SpaceX CEO Musk responded that it wasn’t a conflict because he’s not personally the one who writes grant proposals to the DoD. Seriously. Could you think of a more idiotic response?
BREAKING: Elon, whom Trump allowed to speak as if he were President, says him auditing the DoD isn’t a conflict of interest because he is not personally filing for government contracts at his companies, his staff are. They really believe we’re that stupid. pic.twitter.com/oQg0wbWqax
— Really American 🇺🇸 (@ReallyAmerican1) February 11, 2025
At least 11 federal agencies targeted by the Trump-Musk firings and cuts “have more than 32 continuing investigations, pending complaints or enforcement actions into Mr. Musk’s six companies”
per @nytimes pic.twitter.com/ap1qsK9Voq
— Ian Sams (@IanSams) February 11, 2025
This morning, I sent a letter to the Office of Government Ethics (OGE) regarding @elonmusk‘s potential conflicts of interest.
Within minutes, the White House confirmed receipt.
By noon, President Trump fired the Director of OGE.
I want to know: Was this to prevent his answer?
— Adam Schiff (@SenAdamSchiff) February 11, 2025
There have also been several examples of him making massive claims without adequate understanding or information (or ability to figure out what he and the 20-year-olds on his DOGE team are looking at).
Will MAGA apologize for calling me a liar? Waiting!
Reporter: It wasn’t $50 million for condoms to Gaza— it was Mozambique for HIV prevention.
Musk: “Some of the things I say will be incorrect. Nobody is gonna bat 1000.”
— Brian Krassenstein (@krassenstein) February 12, 2025
President Trump and his team repeated the obviously wrong condom story over and over.
No different than the cats/dogs of Springfield. https://t.co/OLAEvzGSau
— Rohan Patel (@rohanspatel) February 11, 2025
Elon Musk thinks he’s uncovered MASSIVE FRAUD in the Social Security system because he saw duplicate SSNs in a database.
This is, of course, very stupid. Let’s talk about why. 🧵
— Nick Jack Pappas (@Pappiness) February 12, 2025
And then there’s the basic fact that they are completely ignoring the Constitution, as this former Tesla executive points out:
Trump team needs a basic civics lesson.
Unelected bureaucrats don’t pass laws or appropriate dollars – that’s our elected Congress.
You want to shut down agencies or reduce spending in a meaningful way? Pet Article 1, thats also done by Congress.
Bureaucrats operate… https://t.co/MZBAbDtRwD
— Rohan Patel (@rohanspatel) February 12, 2025
BREAKING: In a stunning moment, Jared Moskowitz just exposed how DOGE is a complete scam. This is insane. pic.twitter.com/kRoTas7E8z
— Democratic Wins Media (@DemocraticWins) February 12, 2025
There could also be concern that Trump is going to quickly get sick of Musk taking his spotlight and boot him.
“Why are you in my Dad’s chair?” pic.twitter.com/UcJcUf4fbe
— Evan (@daviddunn177) February 11, 2025
The least someone could have done was give Trump a coloring book and some crayons to keep busy while President Musk answered questions. https://t.co/11zHQLCpxY
— Melanie D’Arrigo (@DarrigoMelanie) February 12, 2025
Trump seethes as President Musk’s kid eats his boogers then paws his desk. pic.twitter.com/8fFXSfEDKM
— Molly Ploofkins (@Mollyploofkins) February 11, 2025
elon’s son just put a booger on the Oval Office desk pic.twitter.com/RLao6w6XFv
— Davidoff (@holy_cabron) February 11, 2025
Whoever did this is a genius. pic.twitter.com/68F61dZIoG
— Machine Pun Kelly 🇺🇦 (@KellyScaletta) February 12, 2025
And, perhaps there’s even more going on…
Inflation & Economic Crash
Trump policies are already hurting many people, and will hurt many more.
Meet Trump voter and Missouri Cattle Farmer Skyler Holden.
He’s about to lose his farm because Trump signed an executive order to freeze President Biden’s Inflation Reduction Act which provided funds for Skyler’s Farm.
Let me say that again….
He’s about to lose his farm… pic.twitter.com/lp9cdzgkxJ
— Travis Matthew (@Matthewtravis08) February 11, 2025
Elon Musk promised transparency at the White House today
When an official revealed that nearly $500 million in food was about to spoil thanks to DOGE, he was fired. https://t.co/gx2VwFgmQc
— Jon Favreau (@jonfavs) February 11, 2025
Project 2025 was unpopular because of things like the plan for Trump to shut down the CFPB, which helps you get your money back if a bank cheats you.
— Pete Buttigieg (@PeteButtigieg) February 11, 2025
Overall, there may just be growing concern about lack of competency and the harm that could ensue, to Tesla, the United States, and the global economy as a whole.
This is Orwellian pic.twitter.com/0dz6W6loMO
— rohit (@krishnanrohit) February 10, 2025
Imagine for a moment you’re getting clobbered in $TSLA, its now down 30% off its recent highs 2 months ago, and the CEO of the company you’re invested in is spending his free time calling himself “hairy balls” and offering circumcisions at a 69% discount. No concerns? pic.twitter.com/12SLg6vXvD
— jbulltard (@jbulltard1) February 11, 2025
Related to all of that, there’s growing concern of authoritarian fascism. That’s what Trump and Musk seem to be rolling out. And what’s the problem with authoritarian fascism? Well, there are many problems with it, but one is there’s no real political accountability for doing a shitty job. You stay in power because you’ve corrupted the system and broken democracy, no matter how badly you’re doing. It’s not often that this turns out well for the people of a country.
BREAKING: Trump appears to be suggesting that he intends to investigate federal judges who rule against him.
What kind of governments engage in such actions? Authoritarian regimes.
What type of leaders disregard the separation of powers? Dictators.
And who tends to blame… pic.twitter.com/QojMkhTYMj
— Brian Krassenstein (@krassenstein) February 11, 2025
If you claim every election you lose is rigged, every judge that rules against you should be removed, and everyone that you disagree with should be investigated and sent to prison…
You are a Fascist. Plain and simple.
That’s not name-calling. That’s truth-telling.
— Tom Santos (@tommysantos14) February 12, 2025
The single most important article yet published on Trump’s second term, by two scholars who since 2016 have been consistently correct in anticipating Trump’s effect on our political system. Everyone should read it. pic.twitter.com/HGtWc0v6KL
— Max Fisher (@Max_Fisher) February 11, 2025
Or maybe none of this is a concern for Tesla/TSLA; it’s just a blip and will resume its course to the moon — or Mars — soon.
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