Tesla Inc. (TSLA) plunged 6.64% on Thursday, closing near $407.52 and wiping out $85 billion in market value in a single session. The drop—the worst in four months—extended a three-day rout exceeding 10%, pushing the stock negative year-to-date and erasing the brief euphoria after Elon Musk’s $1 trillion pay package ratification.
The carnage wasn’t solo. A broader tech purge dragged the Nasdaq down 3.6% as Nvidia fell 3.6%, Broadcom cratered 7%, and even data-center darling CoreWeave sank 8.3%. Fed Chair Jerome Powell’s hawkish tilt on inflation reignited fears that rate cuts may stall, hammering high-multiple growth names. Tesla, trading at 110× forward earnings despite slowing deliveries, proved especially vulnerable.
Adding insult, Cathie Wood’s ARK Invest—long Tesla’s loudest evangelist—sold for the fourth consecutive session, its longest TSLA trimming streak in months. On Wednesday, ARK Innovation ETF (ARKK) and ARK Next Generation Internet ETF (ARKW) dumped 70,474 shares worth $30.35 million, per daily filings. Combined with prior sales (5,426 shares Tuesday, 12,100 Monday), ARK has shed over $45 million in Tesla this week alone. ARKK and ARKW themselves bled 5.25% and 5.09%, respectively, as growth funds faced a reckoning.
Wood’s retreat is seismic. Tesla remains ARK’s largest holding, but the sales signal profit-taking amid valuation vertigo and rising competition. China’s BYD outsold Tesla globally last quarter, while Ford’s F-150 Lightning and GM’s Ultium platform gain traction. Tesla’s U.S. market share in EVs has slipped below 50% for the first time since 2019.
Cybertruck production delays, a stalled Semi rollout, and softening China demand cloud the January 29 earnings outlook. Analysts now forecast just 1.81 million deliveries for 2025—barely above 2024’s 1.79 million—despite the Robotaxi hype.
For the 41% of Tesla owned by retail investors, the dip sparks “buy the blood” memes on X. Yet the macro backdrop is brutal: 10-year yields at 4.6%, a stronger dollar, and Trump-era tariff threats looming over imported batteries.
If this is happening to Tesla—the $1.3 trillion gorilla with unmatched scale, brand, and charging network—does ANY other EV manufacturer in the USA have a chance at success?
Rivian bleeds cash, Lucid trades pennies on the dollar, and Fisker is bankrupt. Even legacy giants like GM and Ford lose thousands per EV sold. Tesla’s pain isn’t just a company story—it’s an industry stress test. If the pioneer can’t grow deliveries or margins in a “normal” rate environment, the runway for startups shrinks to a tightrope.
Support sits near $380; a break risks $340. Bulls cling to Full Self-Driving milestones and energy storage growth. Bears see a 2022-style reckoning. One thing’s clear: the EV revolution isn’t dead—but in America, it may now have only one viable survivor.