Why Tesla's Market Share Fell Below $1 Trillion

The post-election rally that sent Tesla (TSLA) stock to nearly $500 continued to unravel. TSLA stock peaked at $488.54 in December but formed a bearish downtrend since then. Selling intensified on high volume on Feb. 25. It closed at $302.80, down 8.39%.Tesla’s market capitalization is $973.96 billion, below the $1 trillion milestone. Consumers are avoiding Tesla electric vehicles. CEO Elon Musk’s involvement with the U.S. Department of Government Efficiency causes consumers to choose sides. Those who disagree with his policies will not buy a Tesla.Investors may want to avoid TSLA stock. Instead, China’s Li Auto (LI) is compelling. LI stock gained 13.2% yesterday to close at $29.84. The firm said it is developing an all-electric SUV. Similarly, Xiaomi (XIACY) has potential. The firm is launching a Xiaomi Ultra EV SUV.In Europe, Tesla sales fell by 45% in January Y/Y. The European Automobile Manufacturers’ Association (ACEA) reported that European car registrations fell by 2.6%. In fairness, Tesla had tough Y/Y comparable, when it launched a new Model 3.No Driverless Cars or CybercabTesla has yet to launch a full self-driving service. Customers who paid a deposit are still waiting for it. Similarly, Tesla targeted a Cybercap robotaxi for a 2026 production start. The firm unveiled the product in October 2024.Tesla stock is pricing in the prospects the company selling both technologies. The longer the company takes to launch them, the higher the risk that the stock falls.