Tesla could be heading straight for a wipeout

Tesla could be heading straight for a wipeout after Wells Fargo warned that the company’s car business is falling apart and might drag the stock down 61% from where it stood at Monday’s close. 

That’s what analyst Colin Langan said in a note to clients this week, according to Wells Fargo, laying out a brutal reality: the company’s sales are slipping, demand is shaky, and price cuts disguised as promos are eating into profits. “TSLA fundamentals of the core auto business continue to weaken,” Colin wrote.

The report came with a downgraded $120 price target, a huge dive from the $308.58 closing price on Monday. That kind of plunge would wipe billions from Tesla’s market cap. The issue isn’t just the price tag—it’s what’s going on under the hood. 

Global deliveries in May dropped 23% year over year, which signals big trouble for a company still pretending things are steady on the surface. Even though official online prices look unchanged, the company has been running aggressive financing promotions that act as stealth discounts, pulling down actual revenue.

Pressure builds as Robotaxi launch nears

Colin said the buzz around the June 12 robotaxi launch in Austin, Texas, isn’t going to be enough to turn things around. “Most investor attention is directed at the June 12th Austin Robotaxi deployment. We doubt the likely limited debut will be enough to overshadow the poor fundamentals,” he said. The Robotaxi rollout, led by Elon Musk, is supposed to be a major moment, but the core problems aren’t going away.

And the so-called tailwinds like autonomous driving and tech play don’t hold the same weight anymore. Colin believes they aren’t strong enough to offset how bad the core auto sales have gotten. Meanwhile, Tesla is still under pressure from China, where competition has been heating up, and local EV companies are pushing harder. That’s been killing momentum, especially with Tesla’s pricing edge fading fast.

Then there’s the Trump administration, back in power and creating new problems. Fresh tariffs from President Donald Trump could shake up supply chains, but nobody really knows how much yet. The uncertainty is piling on top of everything else.

Tesla’s stock is down 22% in 2025 and nearly 10% in June alone. The selloff lines up with the ongoing political chaos between Elon and Trump. The two have been publicly clashing after Elon trashed Trump’s tax cut plans in Congress. 

Trump fired back with personal attacks. They dragged the fight onto X and Truth Social, trading jabs while the company’s stock kept falling. The whole thing followed Elon’s exit from his short-lived role as a “special government employee” for Trump, where he oversaw something called the Department of Government Efficiency (DOGE).

Things may have gone quiet between the two in recent days, but the damage is already done.

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