Tesla stock has plummeted more than 50% from its record high of $480 per share, set in December shortly after Donald Trump’s presidential win. Optimism surrounding Elon Musk’s connection to the Trump administration faded fast, and now Tesla shares down has become a recurring headline as investors question what comes next.
History Shows A Pattern Of Big Rebounds
This marks the fourth time Tesla has suffered a drop of 50% or more. The previous three declines all ended with dramatic comebacks. In 2019, after Model 3 production issues, shares soared 394%. In 2020, following the pandemic crash, the rebound was a stunning 804%. And in 2022, after a 73% crash tied to supply chain chaos and Musk’s Twitter acquisition, Tesla returned 140% by late 2024.
On average, Tesla shares gained 446% in the 12 months following each of those major dips. That pattern offers some hope. However, analysts caution this time could be different.
The Current Drop May Not Be Over Yet
While previous crashes were followed by fundamental improvements or product milestones, this time, many of the core problems remain unresolved. The recent rally was fueled more by speculation about Trump-era benefits than by business results. Now that those benefits haven’t materialized, and Tesla shares down continues to trend, cracks are starting to show.
Sales have slowed, competition is increasing, and investor confidence is shaky. Moreover, Musk’s political involvement may be weighing on the brand. The company’s recent 45% slide from its high highlights the risks if these issues persist.
Demand Drops As Competition Heats Up
Tesla’s market share declined sharply in its three biggest regions in 2024, with losses accelerating in early 2025. In January alone, the brand dropped nearly 7% in the U.S., 8% in Europe, and 2% in China. Europe saw a 49% plunge in sales through February, even as the electric vehicle market grew overall.
Rivals are quickly catching up, and Tesla’s aging model lineup has done little to stop the bleeding. While the upcoming Model Q may provide a boost, it might not be enough if consumer sentiment continues to sour, especially due to Musk’s high-profile role in the Department of Government Efficiency (DOGE).
Robotaxis Could Be Tesla’s Next Big Bet
The company hopes to regain momentum by launching its robotaxi service in Austin, Texas, this June. Unlike competitors like Waymo, which rely on lidar and radar, Tesla uses only cameras and computer vision. That approach may make Tesla’s service more scalable and cheaper, but also riskier.
Waymo already operates in multiple cities and has years of experience with autonomous driving. For Tesla to catch up, its robotaxi rollout must be smooth, fast, and safe. Any stumble could set the company back significantly.
Can Tesla Still Turn Things Around?
There’s no question Tesla has defied expectations before. The company has a history of rebounding from steep losses, and Musk’s bold moves often drive investor excitement. But this time, the challenges are broader: falling demand, brand damage, delayed products, and increasing competition.
The Tesla shares down trend may not reverse unless these problems are addressed head-on. Historical rebounds are encouraging—but only if Tesla can prove it’s still leading the EV race.
