Tesla finds itself in a bind as it lost all the gains it has made since the election of the new Trump administration.

On Monday, the company’s shares fell 5.8%, extending an eight-week losing streak that has halved its value in three months.

What once made the company stand out in the electric vehicle market now seems outdated as Chinese manufacturers like BYD and NIO flood the industry with stylish and affordable alternatives.

Since mid-December, Tesla’s shares have plummeted 53%, dropping from $479.86 to around $220, wiping out more than $800 billion in market value.

The Musk-owned brand has experienced an eight-week losing streak, its longest since debuting on the Nasdaq in 2010. On March 10, Tesla shares dropped 15%, their worst day since September 202 .

“We struggle to think of anything analogous in the history of the automotive industry, in which a brand has lost so much value so quickly,” according to the analysts at JPMorgan.

Year-to-date, Tesla shares have fallen by 44%, marking the steepest decline of any company on the S&P 500, according to FactSet data.

“Market rivalry and reputational fallout”

Chris Tang, Professor of Business Administration at UCLA Anderson School of Management, explains how regional dynamics are complicating Tesla’s market position.

“In the US, Tesla has no major competitor because Chinese EVs are not present. However, sales have dropped primarily due to Musk’s political alignment, which has turned Tesla into a symbol of division. Some owners have even sold their vehicles in protest against his chaotic method of firing federal employees as head of DOGE.”

However, the situation is different in China. The Chinese brands are innovating at a much faster pace.

“The decline is due to a combination of factors, most notably the rapid advancement of domestic EV manufacturers. Tesla's Model 3 and Model Y. These were initially groundbreaking, but are now perceived as outdated compared to the innovative designs offered by BYD, NIO, XPeng, and Xiaomi,” Tang tells TRT World.

Meanwhile, the European market presents its own distinct set of challenges for Tesla.

The company is encountering fierce competition in Europe from established automotive giants such as “VW, Volvo, BMW, MG, and Chinese automaker BYD”. 

Compounding these competitive pressures, Musk’s controversial comments—particularly on the US potentially withdrawing from NATO and the Russia-Ukraine conflict— along with his perceived alignment with German far-right parties, have significantly “damaged Tesla’s brand perception among European consumers”. 

As Tang explains, this combination of market rivalry and reputational fallout has created “substantial hurdles for Tesla’s future growth in Europe.”

“Tough” road ahead for Tesla?

Wall Street analysts are now estimating that Tesla’s stocks will have fallen again in the most recent quarter. 

A key factor behind this decline is what finance professor Aswath Damodaran previously pointed out—investors cannot “separate Tesla, the company, from Musk.”

A recent Morgan Stanley investor survey revealed that 85 percent of respondents believe Musk’s political activities are having “a negative or extremely negative impact on Tesla’s business fundamentals.”

About 53% respondents to a CNN poll published last week said they hold a negative opinion of Musk compared to roughly 35% with a positive view and about 11% with no take.

Mizuho analyst Vijay Rakesh noted that Tesla's sales problems come from "a deterioration in geopolitics, brand perception (US/EU), share loss due to stronger competition (China), and softer-than-expected demand for Tesla's recent Model Y refresh.”

Professor Tang says it is “tough” for Tesla to recover, especially in Asia.

“Tesla does not have new models and the so-called new model is a cheaper version of Model Y that Tesla is launching this year. But Model Y is already outdated. Price sensitive consumers are likely to opt for more exciting lineups offered by BYD, NIO, or Xiaomi.”

Referring to the stock price decline, Elon Musk offered a characteristically brief and uncaring assessment in his X post, saying "It will be fine long-term".

However, Ross Gerber —one of Tesla’s earliest investors—has stated yesterday that Elon Musk should step down as chief executive, arguing that “the business has been neglected for too long.”

As Tesla vehicles were reportedly set on fire in what authorities described as a “targeted attack” at a Las Vegas dealership on Tuesday.

“This level of violence is insane and deeply wrong,” Musk said on X. “Tesla just makes electric cars and has done nothing to deserve these evil attacks.”