Tesla Hits An Airpocket

Tesla (TSLA) has problems and so do other tech firms at the start of 2025.

Saying that doesn’t give comfort even with a great bull market of 12 years.

The scary thing here is that many tech bulls might believe this is the end of the stock market party.

Moving forward, we will see many tech firms miss gross revenue and profitability.

Then there is the future forecast and I wouldn’t blame management on making excuses using the trade war which they can’t control.

Tesla missed their first quarter revenue target by nearly $2 billion.

Management has literally been in Washington DC getting into politics, and that has hurt Tesla’s stock.

Tesla’s stock almost halved to around $200 before catching a bid.

CEO and Founder Elon Musk said he will step back from his role with DOGE, staying involved part time.

He said he'll continue to spend a day or two a week on government matters, for as long as President Donald Trump wants him to.

Looking forward, a potential key revenue driver is the robo-taxi.

Tesla is set to debut this service in Austin this June, starting with "maybe 10 to 20 vehicles," Musk said.

Tesla also confirmed on the call that the initial launch will include remote human operators who can intervene if a vehicle becomes stuck or encounters an issue.

Musk said the goal is to bring the service to "many other cities in the US by the end of this year," predicting that "there will be millions of Teslas operating fully autonomously in the second half of next year."

Musk said that Tesla would be "the least affected car company" when it comes to tariffs.

"With respect to supply chain risk, something that Tesla has been working on for several years, is to localize supply chains," Musk said. "Tariffs are still tough on a company when margins are still low, but we do have localized supply chains in both America, Europe, and China, so that puts us in a stronger position than any of our competitors."

I do believe the low 200 level for the stock should hold as resistance for TSLA.

Much of the bad news, and there is a lot, is already priced into the stock.

It will be interesting to see if the brand recovers, because the product is deeply unpopular in California and Western Europe.

To be honest, while we wait on the robo-taxi to roll out, Musk saw an air pocket and we are hitting that with full turbulence.

That being said, if there was not a change of administration, there is no way he could make headway with the robo-taxi division.

Musk is waiting on the robo-taxi to save the day and the possibility that happens is better than 50%. In the meantime, I believe he will have a hard time moving sales of his standard EV. He has done a lot of damage by alienating half of his addressable audience.

I believe the stock slowly creeps higher, but in a volatile way.

As for Musk, I think he’ll be spending more time at his day job moving forward and that should help the stock just for that.