Tesla Stock Dips as Robotaxi Hiccup and EV Slump Worry Investors

As of June 17, 2025, Tesla (NASDAQ: TSLA) continues to navigate a turbulent market landscape, with its stock reflecting both optimism and skepticism about the company's future. The electric vehicle (EV) giant, once a darling of Wall Street, has seen its shares decline approximately 14% year-to-date, trailing broader market indices like the S&P 500. This comes after a volatile first quarter, where shares plummeted 41.5% before rebounding nearly 64% by late May, driven by anticipation for Tesla’s autonomous driving initiatives. However, recent developments have tempered that enthusiasm.

One of the biggest focal points for investors has been Tesla’s much-hyped robotaxi service, initially slated to debut in Austin, Texas, on June 12. CEO Elon Musk pushed the launch to June 22, citing the need for further refinement of the Full Self-Driving (FSD) software. Musk also made bold claims about a driverless trip from Austin to Los Angeles, but skepticism persists. Analyst Ross Gerber, a former Tesla shareholder, recently sold his stake, warning of a potential 50% stock crash in 2025 and questioning the viability of FSD. “If FSD doesn’t work, it’s a gut punch to Tesla’s biggest growth driver,” Gerber noted. Protests in Austin on June 12, including a demonstration where a Tesla Model Y failed to stop for a child dummy, have further fueled public and investor concerns about the technology’s readiness.

Tesla’s core EV business is also struggling. Demand in key markets like China, Europe, and the United States has softened, with delivery estimates falling and used Tesla prices dipping while broader used car prices rise—a troubling sign for brand strength. Guggenheim analysts recently described Tesla’s fundamentals as “deteriorating at an alarming rate,” pointing to weak second-quarter delivery trends and lackluster sales of the refreshed Model Y. Price cuts have slashed average selling prices by about 25%, and expectations for 2025 automotive revenues are down nearly 60% compared to June 2022 forecasts. Morningstar analysts called Tesla “tremendously overpriced” at $320 per share, highlighting a 2025 price-to-earnings ratio of over 170x and negative sales growth.

Despite these challenges, some analysts remain bullish. Wedbush’s Dan Ives raised his price target to $500, citing Tesla’s “golden age of autonomous” as the robotaxi debut nears. 24/7 Wall St. projects a year-end price of $352.99, representing an 8% upside, with revenue expected to grow from $112.09 billion in 2025 to $297.43 billion by 2030. The company’s energy storage business and charging network continue to bolster margins, offering a silver lining amid automotive woes. Additionally, a recent cooldown in tensions between Musk and President Donald Trump, following a public spat over a tax bill that threatened EV incentives, has helped stabilize shares, which gained 13.84% over the past five trading sessions.

The broader market context adds complexity. The “Magnificent Seven” stocks, including Tesla, rose on June 16 as falling oil prices encouraged risk-taking, but macro uncertainties like tariffs and steady Federal Reserve rates (425-450 bps) could impact consumer spending. Tesla’s $917 billion market cap, down 29.3% this year, places it tenth globally, a slip from eighth at the start of 2025.

For investors, Tesla remains a high-stakes bet. The robotaxi launch could be a game-changer if successful, but delays and technical hurdles loom large. Coupled with declining EV demand and a lofty valuation, Tesla’s path forward is fraught with uncertainty. As one X user put it, “Tesla’s stock is a gamble like no other—huge rewards if they pull it off, but the risks are brutal.