Investor Fears Surge Over Weak Q1 For Tesla

With Tesla’s market value dipping below $1 trillion this week, Wall Street appears to be coming to terms with the likelihood of a weak first quarter for Elon Musk’s electric vehicle company, Fortune’s Data Sheet journalist Christiaan Hetzner reported.

After two consecutive years of rapid growth, January registrations nearly halved year-over-year.

Even Tesla’s most loyal supporters are beginning to sound the alarm, warning that deliveries may fall significantly short of expectations when the company reports sales figures in early April.

Some analysts fear that the numbers could even come in lower than last year’s 386,000 vehicles.

Tesla’s stock soared following Musk’s strategic bet on a Trump presidency, which fueled investor enthusiasm after the November election. However, the company’s ability to defy fundamentals and trade purely on momentum appears to be fading as market realities take hold.

Investor concerns are well-founded. Data released Tuesday highlighted the full extent of Tesla’s sales decline in Europe.

After two consecutive years of rapid growth, January registrations nearly halved year-over-year, reducing Tesla’s share of the European EV market to just 6%—down from 15% in January 2024.

Meanwhile, in China, Tesla’s sales volumes are tracking 11% lower compared to the same period last year, according to the latest weekly insurance data.

One major factor behind the slowdown: Tesla has temporarily shut down all four of its manufacturing plants for retooling. The company is preparing for the launch of a revamped Model Y next month—a critical vehicle that accounts for two out of every three Tesla sales.