When the 'Traffic King' No Longer Endorses: Can Tesla Rely on Hard Power to Navigate Through Trump's 'Diplomatic Break' Storm?
Amid the continued enthusiasm for AI and tech stocks, the U.S. stock market has staged a strong rebound overall, but Tesla has bucked the trend, plummeting over 14% in early June, with its market cap evaporating nearly $150 billion in a single day, shocking the market. From disappointing delivery figures to skepticism about Robotaxi's prospects and Elon Musk's direct clash with Trump, a series of negative developments have led to deep reflection: Is $Tesla(TSLA.US)'s growth story hitting a real-world bottleneck?
1. Rising Policy Risks: Musk and Trump Part Ways
Musk recently opposed Trump's proposed "Big and Beautiful" tax cut bill, which not only eliminates subsidies for electric vehicles but could also significantly widen the deficit, directly impacting Tesla's sales and profits. This stance prompted Trump to publicly criticize Musk, vowing to cut ties and even hinting at ending SpaceX's government contracts. This undoubtedly weakens Musk's long-accumulated political moat, casting doubt on the future of government subsidies for Tesla.
In short, Tesla's policy tailwinds face uncertainty, with potential downside risks to future subsidies and government support.
2. Fundamental Pressures: Declining Sales + Deteriorating Margins
Meanwhile, fundamental pressures are mounting. Sales in China and Europe are slowing, forcing Tesla into price wars to maintain market share, rapidly eroding gross margins—some models have even dipped below 20%. The highly anticipated Model 2 remains unseen, delaying Tesla's expansion into the mid-to-low-end market. While Full Self-Driving (FSD) continues to iterate, it has yet to achieve stable monetization, failing to convert technological leadership into profits—a major pain point.
3. Robotaxi: A Distant Solution for Immediate Thirst
Despite Musk's announcement of a Robotaxi launch in August 2025, initial market enthusiasm has cooled as rational assessments of its near-term feasibility emerge.
Compared to Waymo and Cruise, Tesla's vision-only approach lacks broad validation and faces regulatory, safety, and insurance hurdles. Thus, Robotaxi remains a long-term vision rather than a short-term catalyst.
4. Shaken Confidence: Downgrades and Capital Outflows
Post-selloff, multiple firms downgraded Tesla. Baird cited brand risks, management uncertainty, and policy exposure, reflecting heightened caution. Capital is also shifting to pure-play AI stocks like $NVIDIA(NVDA.US), despite Musk's attempts to build an AI ecosystem via X, xAI, and FSD—lacking a mature business model, the market remains skeptical.
Personal View: Short-Term Noise vs. Long-Term Potential
Notably, Tesla rebounded 4.55% on June 10, with Morgan Stanley reiterating its $800 target, signaling enduring faith in its long-term thesis.
From a macro perspective, Tesla retains core advantages—not just in EVs but also in autonomous driving, robotics, and energy storage, aligning with U.S. reindustrialization. Despite near-term uncertainties, its strategic scarcity and vision remain compelling.
Conclusion: "Faith Isn’t Investment—Execution Is."
Tesla's challenges are growing pains. External risks, revenue pressures, and unmonetized tech are repricing expectations. This isn’t a myth shattered but a bubble deflating.
The market rewards cash-flowing innovation. If FSD commercializes, Model 2 launches affordably, and Robotaxi debuts on schedule, Tesla could reclaim its AI and tech leadership.
Volatility brings risk and opportunity—the question is whether you trust Musk to turn future bets into tangible returns.
$Apple(AAPL.US) $Alphabet - C(GOOG.US) $Amazon(AMZN.US)
The copyright of this article belongs to the original author/organization.
The views expressed herein are solely those of the author and do not reflect the stance of the platform. The content is intended for investment reference purposes only and shall not be considered as investment advice. Please contact us if you have any questions or suggestions regarding the content services provided by the platform.
