Tesla shares plummeted 6% on Tuesday, marking the fifth straight day of declines, wiping out over $200 billion in market value. The slide follows Chinese rival BYD’s announcement to develop autonomous vehicle technology with DeepSeek and plan to offer its Autopilot-like system in most new cars. This has raised concerns that Elon Musk’s company is falling behind.
Musk’s dual role as CEO of Tesla and his efforts outside the company, including leading an investor group to purchase OpenAI, have raised questions about his ability to focus on Tesla’s challenges. BYD’s plans for autonomous vehicles have added to fears that Tesla will struggle to compete with its Chinese rival.
Tesla’s stock price has dropped 17% in five days, falling to $328.50 and surpassing $200 billion in market value lost. The company aims to launch “Unsupervised Full Self-Driving” and a driverless rideshare service in Austin, Texas, but analysts warn that competition may limit its profitability.
Musk is also overseeing the “Department of Government Efficiency” as a special government employee, aiming to reduce federal spending and regulations. This has raised concerns among investors, who are already concerned about Musk’s heavy commitments beyond his company. The Oppenheimer analysts note that Musk’s bid for OpenAI could be a distraction from Tesla’s challenges.
BYD has emerged as Tesla’s fiercest rival, with its new model vehicles equipped with partially automated driving systems. Waymo also operates a robotaxi service in Austin and parts of Phoenix, San Francisco. Analysts predict that competition will limit Tesla’s profitability, even if the company meets its timeline for driverless cars.
As Musk’s public life becomes increasingly entangled with his work on other projects, investors may become more cautious about his ability to lead Tesla effectively. With Tesla’s stock price under pressure and rival companies gaining ground, Musk’s focus on multiple fronts raises concerns about the company’s future.
Source: https://www.cnbc.com/2025/02/11/tesla-drops-7percent-on-self-driving-competition-musk-openai-distractions.html