Tesla’s Aura Dims as Its Plunging Stock Highlights the Risks It Faces

Tesla stocks are reacting to the same forces that are thrilling stock markets around the world: the war in Ukraine, rising interest rates, fears of a recession, supply chain chaos and rising inflation. But Tesla’s shares have fallen far more than other Silicon Valley giants like Apple or Alphabet, which is owned by Google.

Tesla accounted for three-quarters of all electric cars sold in the United States last year. The company is many years ahead of its competitors in battery technology and software. But two models – the Model 3 sedan and the Model Y sport utility vehicle – account for 95 percent of Tesla’s sales. Its next consumer vehicle, a pickup truck, has been delayed several times and is not expected as early as next year.

In the car industry it is a self-evident that new models sell fuel. And competition from Hyundai, Ford and Volkswagen is growing, offering drivers much more choice.

Auto industry veteran Jesse Toprak, who is chief analyst at Autonomy, a company that offers electric cars through subscriptions, said Tesla’s market share would fall below 40 percent by the end of 2023, although sales as a whole would continue to grow. Extends.

“They will have a small portion of the big pot,” Mr. Toprak said. “But their near-monopoly on EV sales in the US will gradually decline.”

Tesla is already facing stiff competition in Europe, where electric vehicles account for 13 percent of new car sales. It gives a glimpse of what could happen in the United States, where sales of battery-powered cars are just beginning. Volkswagen, which has invested heavily in electric vehicles, sold 56,000 battery-powered cars in Western Europe during the first three months of the year, behind Tesla’s 58,000, according to figures compiled by Schmidt Automotive Research in Berlin.

The addition of a new factory near Berlin will improve Tesla’s ability to serve the European market. In the United States and elsewhere, the company has benefited from radically loyal buyers who are Mr. Musk is a dreamer and is willing to wait months or years for a company car.

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