Elon Musk's Tesla in Turmoil: Stock Plummets as Boycotts and Investor Doubts Mount

Once considered the undisputed leader in the electric vehicle (EV) revolution, Tesla is now grappling with a dramatic decline in its stock value, mounting competition, and an impending wave of boycotts. The company's struggles come amid growing concerns over CEO Elon Musk's political entanglements, including his controversial role in the Department of Government Efficiency (DOGE), which has sparked nationwide protests.

With its market position under threat and its valuation under scrutiny, the road ahead for Tesla looks increasingly uncertain.

Tesla's Stock Takes a Nosedive

Tesla shares plunged 14% last Monday, extending their losses to a staggering 37% since 19 February. The electric car giant, once a favourite among Wall Street investors, is now reeling from a combination of economic uncertainty, trade tensions, and declining demand.

The stock's sharp downturn places Tesla among the biggest casualties of the recent market sell-off, alongside tech giants like Apple, Alphabet, and Meta. Analysts warn that persistent investor scepticism, combined with rising interest rates and supply chain disruptions, could prolong Tesla's downward spiral.

'The public eye seems to be coalescing around what he's doing for the federal government. So if you're a shareholder, you can't help but wonder if that's not detracting from what he should be doing for the publicly traded company he's running,' said Art Hogan, chief market strategist at B. Riley Wealth.

The Threat of Boycotts

Beyond its stock market troubles, Tesla is also facing growing unrest, with protests and vandalism erupting across the United States. Outrage over Musk's political influence has fuelled a wave of demonstrations, many of which have been peaceful, but some have escalated into acts of destruction.

Several Tesla showrooms and charging stations in Colorado and Massachusetts have been set on fire, while six protesters in New York were arrested after occupying a Tesla showroom.

Even Tesla owners are turning against the brand. Some have begun defacing their own Cybertrucks in protest, while others have taken the more drastic step of selling their vehicles outright.

The anger stems largely from Musk's leadership of the DOGE, which has been accused of cutting 100,000 federal jobs and accessing sensitive government data. Protesters in Burbank held signs reading 'Deport Elon' and 'Boycott Swasticar'—a play on words aimed at drawing parallels between Tesla and fascism.

Karen Rabwin, a former Tesla owner, joined the Burbank protest just 48 hours after trading in her vehicle for a Cadillac. Initially, she had attempted to distance herself from Musk's actions by placing a bumper sticker on her Tesla that read, 'Bought This Car Before We Knew'. However, she ultimately decided it wasn't enough.

'It was embarrassing,' she said. 'It wasn't what I stood for. How could I drive that car? I have principles.'

Investors Question Tesla's Valuation

Tesla's stock has now fallen nearly 45% in just three months, wiping out much of its previous gains after Musk publicly backed Donald Trump's re-election campaign. Despite this dramatic downturn, the company's valuation remains significantly higher than that of traditional automakers—a reflection of Musk's ambitious vision for Tesla's role in artificial intelligence and autonomous driving.

However, investor confidence is beginning to wane. Tesla shares fell another 15% on Monday, erasing over £98 billion ($125 billion) in market value after UBS downgraded its first-quarter delivery forecast. The sell-off coincided with broader market fears of tariffs and a looming recession, sending the Nasdaq down 4% and the S&P 500 tumbling 2.7%.

Even after its recent collapse, Tesla's £664 billion ($845 billion) valuation still surpasses the combined worth of the next nine largest automakers. But as doubts grow over Musk's ability to deliver on his promises—particularly in AI and robotaxi development—many investors are starting to question whether the company is significantly overvalued.

What's Next for Musk and Tesla?

Despite the stock's sharp decline, Tesla remains the world's most valuable automaker, far outpacing legacy brands like Toyota and Volkswagen. However, the gap between investor expectations and Tesla's actual performance is widening, making its future more uncertain than ever.

Musk's ability to sell a bold vision of the future has long sustained Tesla's premium valuation, but growing scepticism over the company's production targets, financial health, and market position is beginning to take its toll.

If Tesla fails to deliver on its AI and robotaxi promises, investor confidence could erode further, threatening both Musk's leadership and the company's dominance in the EV industry. For now, Tesla's fate hinges on Musk's ability to restore faith in his grand vision—or risk seeing the company's market dominance slip away.