Tesla (NASDAQ:TSLA) stock has been very volatile in recent months. Shareholders have faced various challenges, some of which weren’t present at the start of the year. If an investor had decided in January to put £1k in the US stock, here’s what it would be worth at the moment.
Talking through the numbers
At the start of the year, the share price was $380.80. Based on the price as I write (early on 16 July) of $309.47, this represents a fall of 18.73%. In terms of cash, the £1k sum would be worth £812.70.
Before jumping to conclusions that this is an underwhelming performance, it’s key to evaluate this against both the market and peers. The Nasdaq index is up 7.25%, so clearly this is a significant divergence. Regarding EV peers, I can compare it against BYD and NIO. BYD is up 20%, whereas NIO is down 6.6%. This shows me that the sector has differing performance, indicating it’s a period where winners and losers are starting to emerge.
As a side note, if the period were extended for a one-year time frame, an investor would be profitable. Over the past year, the stock is up 22%.
A rocky year
Within all of this, Tesla stock hasn’t performed as the investor would have hoped. At the start of the year, we were relatively unaware of the scope of falling EV demand. At that point, CEO Elon Musk’s political support of incoming President Trump was known, but I don’t think anyone could have predicted the carnage that would emerge on that front.
Fast forward to today, and 2025 has seen Tesla report its first annual decline in global deliveries. Vehicle shipments have continued to falter (European and US deliveries fell by double-digit percentages in Q1), while momentum in China slowed as well.
Intensified competition in the EV space has also eroded Tesla’s lead in the market. Chinese manufacturers and even more traditional global carmakers are releasing compelling alternatives on both price and quality.
Share price outlook
Looking ahead, the removal of the federal EV tax credit under a new bill has weakened Tesla’s near-term US volume outlook. Musk and management are indeed trying to diversify away from the US and China. For example, this week Tesla launched in India. This is the third-largest car market globally, so clearly there’s scope to do well here.
From a shareholder perspective, Musk stepping back from his roles politically could help the business. It’ll give him more time to spend on developing new ideas for Tesla and in general, just be more focused on his role.
Even with these factors, I’m still not convinced that the stock is going to rally materially any time soon. Until I see signs that EV demand is picking back up again, I think the share price could keep falling.
