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After enduring brutal losses yesterday, Tesla shares are on a slightly firmer footing today, helped along by President Trump's pledge to purchase a "brand new" Tesla EV, presumably in a bid to counter the negative optics following a spate of politically motivated attacks on Tesla showrooms and vehicles across the US and the EU. Yet, a top analyst contends that Elon Musk needs to "step up" if today's nascent recovery is to reach the threshold of sustainability.
As we've been noting ad nauseum over the past few weeks, Tesla remains mired in a multi-faceted maelstrom, ranging from the inclusion of overt political partisanship into the EV giant's sales calculus to the phenomenal competition out of China.
Now, Wedbush's Dan Ives has come out with a hard-hitting note on Tesla's travails, arguing that Elon Musk needs to establish a balance between his responsibilities as the CEO of the biggest electric vehicle manufacturer in the world and those relating to his unorthodox political position as the head of the DOGE:
"In a nutshell the word "balance" has been missing with Elon Musk and his ability to run Tesla as CEO....while instead focusing all of his energy and time driving his DOGE initiative within the Trump Administration."
As an example of Elon Musk's inattention towards Tesla, Ives notes that "there has been little to no sign of Musk at any Tesla factory or manufacturing facility the last two months and perception has become reality for Tesla shares."
In what Ives dubs as the "moment of truth," the more Elon Musk doubles down on his DOGE-related efforts, the more protests erupt at Tesla dealerships. More troubling still, recently there has been a spate of vitriol and violence directed towards the owners of Tesla EVs as well.
Despite this troubling escalation, Ives believes that Elon Musk is not "reading the room," leading to an adverse outcome for the shareholders:
"The stock has been under massive pressure down over 50% from its highs in December and Tesla investors are seeing patience wear thin as Musk is not reading the room."
The Wedbush analyst thinks Elon Musk now has to step up for Tesla shareholders, for while the EV manufacturer's brand image deterioration currently remains "contained," with just 5 percent of Tesla owners second-guessing their purchase decision at the moment, a significant deterioration remains a distinct possibility.
Spot on, @DivesTech
"Been here before many times with Tesla ...
This is the start of the biggest innovation and technology cycle in Tesla's history ahead over the next few years. ...
The launching of unsupervised FSD in Austin, Texas this June kicks off the autonomous era at… pic.twitter.com/KM7cdCKhDf— Ale𝕏andra Merz 🇺🇲 (@TeslaBoomerMama) March 10, 2025
Of course, Ives continues to believe that the "medium and long-term innovation cycle at Tesla is as bright as its [sic] ever been." In fact, the analyst recently took pains to identify bullish catalysts for the EV giant, including the likely introduction of a compact, sub-$35,000 EV before the summer and the launch of unsupervised FSD in Austin, Texas, this June.
Do note that Tesla shares are up ~5 percent in the early morning part of today's regular trading session. It remains to be seen, however, if this positive momentum persists through the next few hours and days.
