Tesla (TSLA) stock finished trading on March 26 down 6% on news that sales of the company’s electric vehicles declined another 40% year-over-year in February.
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The latest data from the European Automobile Manufacturers’ Association (ACEA) showed that Tesla experienced a 40% year-over-year drop in its new vehicle registrations in Europe during February. The drop off in sales of Tesla vehicles was especially bad considering that overall electric vehicle sales in Europe rose 26% from a year earlier in February.
The European sales decline added additional pressure to TSLA stock, which is now down 33% on the year and among the worst performing securities in the benchmark S&P 500 index. In addition to the poor European sales figures, Tesla’s stock also took a hit from media reports that U.S. President Donald Trump plans to impose new tariffs on automotive imports.
Mounting Problems
Tesla has been grappling this year with declining sales, vehicle recalls, a deteriorating reputation, and increasing vandalism of its products and locations. The problems stem from the role Tesla CEO Elon Musk is playing within the Trump administration, with many consumers boycotting the company’s electric vehicles in protest. Tesla also faces increased competition in Europe and China.
Despite the challenges, Tesla has announced plans to ramp-up production of its redesigned Model Y sport utility vehicle (SUV) in April of this year. The company implemented partial production shutdowns at its factories earlier this year to upgrade Model Y manufacturing lines. Tesla is also moving into new areas that involve supercomputers and humanoid robots.
Is TSLA Stock a Buy?
The stock of Tesla currently has a consensus Hold rating among 36 Wall Street analysts. That rating is based on 14 Buy, 11 Hold, and 11 Sell recommendations issued in the last three months. The average TSLA price target of $335.32 implies 23.25% upside from current levels.