Tesla, Inc. (TSLA) Stock: Faces India Setback and $25K EV Confusion

TLDR

TSLA drops 2.42% to $338.09 as of early June 2025 India confirms Tesla uninterested in local EV manufacturing Musk’s denial of $25K Model 2 EV cancellation sparked internal confusion Tesla shifts focus to robotaxis and stripped-down existing models April earnings update promised affordable models, but details remain unclear

As of 1:05 PM EDT on June 2, 2025, Tesla Inc. (NASDAQ: TSLA) was trading at $338.09, down 2.42%. This follows mixed news globally. In India, a senior minister announced that Tesla has no interest in setting up local EV manufacturing, despite the government finalizing a major electric vehicle policy aimed at foreign automakers.

Tesla, Inc. (TSLA)

India’s new plan will slash import duties from 70% to 15% for automakers committing at least $500 million in domestic EV production. Companies like Mercedes-Benz, Volkswagen, Hyundai, and Kia have shown interest, but Tesla CEO Elon Musk has kept his focus on importing cars — a path complicated by India’s historically high tariffs.

#BREAKING

"Tesla not keen on manufacturing in India"

Union minister HD Kumaraswamy says Tesla is only planning showrooms, not factories. This despite a new EV policy offering 15% duty with $500M investment

Firms like Hyundai & Skoda have shown more interest in 'Make in India'… pic.twitter.com/OScCn1P13S

— Nabila Jamal (@nabilajamal_) June 2, 2025

Affordable EV Confusion Shakes Investor Confidence

Internally, Tesla executives were left scrambling last year after Musk publicly denied a Reuters report that Tesla had scrapped its planned $25,000 EV, nicknamed the Model 2. Executives reportedly knew the project had been canceled and were confused by Musk’s contradictory post on X (formerly Twitter).

Suppliers and investors had been waiting for clarity, especially after Musk’s denial halted a 6% decline in Tesla stock back in April 2024. Behind the scenes, Musk confirmed the project was dead and shifted Tesla’s focus toward robotaxis, particularly a two-door “Cybercab.” However, even the robotaxi debut, teased for August 2024, was delayed and failed to impress when it arrived in October.

Pressure from Competition and Regulatory Risks

Tesla’s April 2025 earnings call provided some hope, with promises of “affordable” vehicles built on existing Model 3 and Model Y lines. Yet many investors remain skeptical. Tesla has faced its first annual vehicle sales decline in 2024, with Q1 2025 sales dropping 13%. Meanwhile, Chinese competitor BYD has surged ahead in global affordable EV markets, even outselling Tesla in Europe in April.

Musk’s social media denials raised new regulatory concerns, as his 2018 SEC settlement requires lawyer vetting on posts about key company matters. Internally, some Tesla leaders worried about misleading investors, but no formal SEC complaints have been reported so far.

EV Policy and Market Headwinds

While Indian EV sales are still just 2.5% of total car sales, the government wants to push that to 30% by 2030. Domestic companies like Tata Motors and Mahindra & Mahindra have heavily invested, making Tesla’s absence from local production even more striking.

Tesla’s delay in rolling out lower-cost models, once considered critical to its future, adds to investor unease as it faces rising global competition and a cooling EV market. With the next earnings date already past (April 2025), analysts will be closely watching for meaningful updates before Tesla’s next quarterly report.

 

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