Tesla Stock Drops Amid Musk Controversy and Trump Tariff Fears

“Tesla Stock Drops Amid Musk Controversy and Trump Tariff Fears”

Tesla shares just had one of their worst weeks in recent memory—plunging 9.2%—and Wall Street isn’t holding back. The EV giant is suddenly on shaky ground between lackluster Q1 deliveries and fresh tariff threats from Donald Trump.

Here’s what’s going on—and why it matters.

TSLA Stock Falls Hard: A Breakdown

On Monday, Tesla’s stock continued its slide, dropping 6.5% in early trading and landing around $223.79. It dipped even lower intraday to $222.11, marking its lowest point since October. Right now the Tesla share price is 227.38 USD (7 April 2025, 11:25 am in USA).

For comparison:

• S&P 500 fell 3.6%
• Dow Jones dropped 3.3%
• But Tesla’s dip was noticeably more severe

This wasn’t just a market dip. It was a Tesla-specific crisis.

Dan Ives Cuts Tesla Target by 43%

One of the most shocking turns came from Wedbush analyst Dan Ives—a longtime Tesla bull—who slashed his price target from $550 to $315. That’s a jaw-dropping $235 cut, translating into nearly $750 billion in lost market cap potential.

Despite the downgrade, Ives kept a Buy rating, showing he still believes in Tesla’s long-term potential… but he’s clearly spooked.

“Musk-created brand crisis + Trump tariffs = perfect storm for Tesla,” said Ives.

What’s Fueling the Crisis?

Let’s break it down.

1. Q1 Deliveries Miss the Mark

Tesla reported around 337,000 vehicle deliveries in Q1, missing expectations by about 40,000 units. That’s a 13% year-over-year decline and the most significant drop since the pandemic.

Investors didn’t take it lightly.

2. Trump’s Surprise Tariff Bombshell

Before the dust could settle, former President Donald Trump dropped a tariff bomb—calling for import duties closer to 25%, rather than the 10–15% range analysts expected.

The result? A massive hit to Tesla’s cost structure and a ripple through its global supply chain, especially when competing against low-cost Chinese EV makers like BYD.

Ives labeled it “economic tariff Armageddon.”

The Elon Musk Effect: A Growing Risk?

Musk’s outspoken persona has always been part of Tesla’s brand, but now it may be backfiring.

Ives says Tesla has “morphed into a political lightning rod globally.” That’s becoming an absolute liability in today’s hyper-competitive EV market.

He estimates that the brand fallout may have already cost Tesla 10% of its global customer base.

Let that sink in.

Wall Street’s Sentiment Is Shifting

Investor confidence is starting to erode. According to FactSet:

• The average price target for Tesla is now $346/share
• Down from $381 just last month
• That’s a $35 drop = around $110 billion in lost market value

A big part of that drop? Elon Musk himself. Some analysts now factor a “Musk risk discount” to Tesla’s valuation.

What About Tesla’s 2025 Profit Outlook?

Analysts say Trump’s proposed tariffs could shave up to $3 billion off Tesla’s 2025 operating profits.

• Original forecast: $9.3 billion
• Current estimate: $8.3 billion
• That’s a $1 billion drop—and we’re not even halfway through 2025

Final Thoughts: Is Tesla Entering a Storm?

There’s no denying Tesla is still a dominant EV player—but it’s facing a multi-front battle:

• Brand turbulence from Musk’s public image
• Political headwinds via Trump’s trade threats
• Fierce competition from Chinese EV makers
• Wall Street doubts are starting to stick

The pressure is mounting for now, and the road ahead could be far from smooth.

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