Tesla Share Price Crash Sparks Investor Concerns: Is It Time To Hold Or Sell Tesla Shares?

Tesla’s share price took another blow on Monday, falling nearly 8% to close at $292.91, as the company struggles with falling electric vehicle (EV) sales, investor unease, and a renewed political clash between CEO Elon Musk and former US President Donald Trump.

The EV giant, once at the forefront of tech-driven stock surges, has now become the worst-performing stock among the ‘Magnificent Seven’ tech giants in 2025. Since its record high of $479.76 in December, Tesla shares have lost nearly 40% of their value, with about $80 billion in market capitalization wiped out.

Musk’s Political Moves Rattle Wall Street

Investor tension worsened over the weekend after Elon Musk announced plans to launch a new U.S. political group called the “America Party,” re-raising tensions with Donald Trump. The former president responded to Musk’s announcement, calling it “ridiculous,” and said he would withdraw any federal subsidies to Musk’s companies, including Tesla and SpaceX.

The tensions, which began as Twitter jabs in early June, have raised concerns about Musk’s attention on Tesla and whether his attention towards politics would only serve to distract him further and exacerbate the company’s struggles.

Poor Sales and Market Uncertainty

Tesla’s troubles go beyond politics. Sales in the first quarter of 2025 fell 13% compared to last year, reflecting declining demand and stiff competition in the EV market. Since last Thursday, Tesla shares have dropped around $26 each, reflecting growing uncertainty.

Analyst opinions on Tesla’s future remain sharply divided. Some firms like HSBC have slashed price targets to as low as $120, while Goldman Sachs stands at $190 and UBS at $225. Others, including Morgan Stanley ($400), Benchmark ($475), and Wedbush ($515), maintain an optimistic view based on long-term technologies like Full Self-Driving (FSD), robotaxis, and Dojo supercomputing.

Should Investors Hold or Exit?

Tesla is now seen as a high-risk, high-reward stock. Market experts suggest closely watching the Q2 delivery numbers, robotaxi rollout progress, and regulatory developments, especially around EV subsidies and trade policies.

While short-sellers have gained around $1.4 billion in paper profits, long-term investors face a tough call. With Tesla’s future hanging between technological potential and political fallout, staying informed and cautious is the best strategy for now.

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