Tesla Sales Plunged in France. What Do Analysts Say About TSLA Stock for June 2025?
Tesla's (TSLA) European operations are experiencing a dramatic downturn, with sales across multiple markets declining sharply despite CEO Elon Musk's claims tht the company has no demand problem.
For instance, in France, Tesla's vehicle deliveries declined by 67% year over year to 721 units, the worst monthly performance in three years. This decline occurred even with the refreshed Model Y in full production at Gigafactory Berlin, eliminating previous supply constraints as an excuse for poor performance.
The troubling pattern extends across Europe, with Portugal seeing a 68% year-over-year decline despite overall EV sales rising 25%. Denmark, Netherlands, Spain, and Sweden all reported significant double-digit drops, indicating systemic rather than isolated market issues.
Tesla Sales Soar in Norway
Norway stands as Tesla's sole bright spot in Europe, with sales surging 213% to 2,346 vehicles in May. However, this increase in demand is at least partially tied to aggressive financial incentives, such as interest-free loans and national policies that support EVs, rather than a recovery in organic demand.
Political factors are impacting Tesla's brand value in 2025. A Norwegian EV Association survey revealed that 43% of respondents would avoid purchasing Teslas due to political reasons. Further, Musk's support for Germany's far-right AfD party and anti-union stance has sparked protests at European dealerships.
Meanwhile, competition continues to intensify as traditional automakers and Chinese manufacturers gain ground. BYD (BYDDY) recently outsold Tesla in pure electric vehicles across Europe for the first time, while established brands like Volkswagen (VWAGY) and Porsche (POAHY) are capturing market share previously held by Tesla.
Tesla's attempts to stimulate demand through price cuts and financial incentives across Sweden, Germany, Britain, and France suggest recognition of its weakening competitive position in what was once a growth market.
Is TSLA Stock a Good Buy Right Now?
Tesla delivered a challenging first quarter, with revenue declining to $19.34 billion, a $1.97 billion year-over-year decrease, while net income dropped to $409 million from $1.39 billion in the prior year period. Despite financial headwinds, Tesla demonstrated operational resilience and maintained a strong balance sheet.
It produced approximately 363,000 vehicles and delivered just under 337,000 units during the quarter, executing an industry-first simultaneous production line changeover across all factories for the new Model Y. This ambitious transition resulted in several weeks of lost production but showcased Tesla's advanced operational capabilities.
Tesla's energy storage business continues to grow with 10.4 GWh deployed in the first quarter. The EV maker is focused on ramping up production and increasing market penetration in this vertical.
However, evolving trade policies pose risks to the energy storage segment. Tesla warned that the ongoing trade war could impact energy generation and storage operations more than its automotive business.
Tesla reported an operating cash flow of $2.16 billion and incurred capital expenditures of $1.49 billion. In the year-ago period, its capital expenditures were much higher at $2.78 billion. The company ended Q1 with a cash balance of $37 billion, an increase of $433 million from the end of 2024.
What Is the Target Price for TSLA Stock?
Tesla faces mounting challenges from macroeconomic pressures, including interest rate fluctuations that affect vehicle financing affordability and intensifying competition as traditional automakers accelerate their adoption of electric vehicles. It continues investing in artificial intelligence, robotics, and autonomous driving capabilities, including the development of the Cybercab robotaxi.
Looking ahead, Tesla emphasizes profitable growth through the optimization of existing factories, cost reduction initiatives, and the launch of new models. The next growth phase depends on advances in autonomy, the introduction of next-generation platform vehicles, and vertical integration, including in-house battery cell manufacturing, to improve performance while reducing costs.
Out of the 41 analysts covering Tesla stock, 16 recommend 'Strong Buy,' two recommend 'Moderate Buy,' 13 recommend 'Hold,' and 10 recommend 'Strong Sell.' The average target price for TSLA stock is $290, below the current trading price of $344..
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