- Rocky Rollout: What Happened With Tesla Robotaxi
- Tesla Sales Continue Slump in Europe
- A Critical Juncture Tesla
Tesla's stock slipped more than 2% on June 24, 2025, capping off a challenging week for the Elon Musk-led electric vehicle giant. The dip was fueled by a double dose of bad news as the company's newly launched robotaxis in Austin, Texas, drew the scrutiny of federal regulators, while disappointing sales data from Europe painted a grim picture of the company's performance in a key market.
The double whammy of bad news has added to Tesla’s mounting challenges, as it grapples with rising competition, shifting consumer demand, and uncertainty about its future growth. In this blog, let’s break down Tesla's troubles.
Rocky Rollout: What Happened With Tesla Robotaxi
The much-hyped debut of Tesla's robotaxi service in Austin, Texas, over the weekend of June 22-23, 2025, was meant to be a glorious moment for the company and a glimpse into the future of autonomous transportation. Instead, it quickly became a headache. The limited rollout, featuring a small fleet of about 10 Model Y vehicles with "safety drivers" in the passenger seat, was heavily promoted by pro-Tesla influencers who were given early access.
However, the very videos they posted to showcase the technology ended up highlighting its flaws. One video, shared by a Tesla investor, showed a robotaxi struggling with a left turn, wobbling into the lane of oncoming traffic before correcting itself. Another influencer praised the vehicle for exceeding the speed limit. These incidents, broadcasted online, did not go unnoticed.
The National Highway Traffic Safety Administration (NHTSA) promptly announced it was aware of the videos and had contacted Tesla for more information. The agency clarified that it does not pre-approve such technologies and that manufacturers are responsible for certifying their vehicles meet federal safety standards. This latest inquiry adds to an existing NHTSA investigation into Tesla's "Full Self-Driving" feature, which was initiated in 2024 after a series of crashes.
Tesla Sales Continue Slump in Europe
As if the robotaxi issues weren't enough, Tesla was also hit with bleak sales figures from Europe. In May 2025, Tesla's new car sales in the region plummeted by a staggering 27.9% compared to the same month last year.
This decline is particularly concerning as it comes at a time when the overall European market for battery-electric vehicles is booming, with a 27.2% increase in sales during the same period. This indicates that Tesla is not just a victim of a sluggish market, but is actively losing ground to its competitors.
The numbers paint a clear picture of a company struggling to maintain its dominance. Tesla's European market share shrank from 1.8% in May 2024 to just 1.2% in May 2025. This marks the fifth consecutive month of declining sales for Tesla in Europe.
| Automaker | May Sales Change (YoY) |
| SAIC Motor (Chinese) | +22.5% |
| BMW (German) | +5.6% |
| Mazda (Japanese) | -23% |
| Tesla (American) | -27.9% |
| Overall European BEV | +27.2% |
Sources: Reuters
Several factors appear to be contributing to this downturn. Industry analysts point to an aging product lineup, with the popular Model Y facing stiff competition from a wave of new and more affordable electric vehicles from both established European automakers and aggressive Chinese brands
Furthermore, the public persona of Tesla CEO Elon Musk is increasingly being cited as a headwind for the company. His political statements and affiliations have led to a backlash in some quarters, with reports of protests at Tesla showrooms and boycotts in both the U.S. and Europe.
A Pattern of Negative News for Tesla
For years, CEO Elon Musk has sold a vision of a future where millions of driverless Teslas roam cities, generating revenue for their owners. The troubled launch, therefore, raises critical questions about whether this vision can become a reality anytime soon.
Tesla’s robotaxi issues and European sales slump are not isolated incidents, but rather the latest in a series of challenges that have plagued Tesla in recent times. The company's first-quarter global sales for 2025 were down 13% YoY, with a 71% drop in net income, a significant drop that sent a clear signal of softening demand.
This flurry of negative news has led to Tesla stock downgrades from financial institutions like Argus Research and Baird, who have cited the uncertainty surrounding the company as a cause for concern. The company has been forced to offer aggressive price cuts and zero-interest financing to move inventory, which has eaten into its once-enviable profit margins.
A Critical Juncture Tesla
Tesla is at a crossroads. Regulatory heat, rising competition, and falling European sales signal mounting pressure. With robotaxi ambitions still unproven, the coming months will be critical in determining whether Tesla can regain its edge in an increasingly unforgiving EV market.
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