EV maker Tesla (TSLA) saw its vehicle registrations in California drop by 21.1% in the second quarter, as the company continues to struggle in one of its most important U.S. markets. Indeed, California has traditionally been a strong area for Tesla, but recent trends suggest that a shift is occurring. Some believe that CEO Elon Musk’s increasingly political behavior, which often clashes with California’s liberal values, might be part of the reason why the brand is losing traction in the state.
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As a result, from April to June, Tesla registered 41,138 new vehicles in California, down from 52,119 in the same period of last year, according to the California New Car Dealers Association (CNCDA). This is the seventh consecutive quarter that Tesla has seen a decline in registrations in the state. To make matters worse, Tesla recorded only 3,622 Cybertruck registrations during the first six months of the year. Still, Tesla’s Model Y and Model 3 continue to be the two most popular vehicles in the zero-emission and hybrid category through the first half of the year.
Interestingly, though, it is worth mentioning that Tesla isn’t the only EV brand facing challenges. In fact, rival Rivian (RIVN) saw a 28.6% drop in second-quarter registrations in California. At the same time, hybrid vehicles are gaining popularity, with registrations rising by 54% in the first half of the year to make up 19.2% of the California market, according to CNCDA. Therefore, investors are currently waiting for Tesla’s second-quarter earnings results, which are scheduled for July 23 after the market closes, for clues on how the company plans to tackle its problems.
What Is the Prediction for Tesla Stock?
Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 13 Buys, 13 Holds, and eight Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average TSLA price target of $299.52 per share implies 10.3% downside risk.
