Elon Musk's Tesla Set For Lowest Quarterly Deliveries Since 2022, JPMorgan Predicts: 'Brand Has Lost So Much Value So Quickly'

JPMorgan analysts forecast Tesla Inc. TSLA to experience its weakest quarter for car deliveries since 2022.

What Happened: Tesla’s CEO, Elon Musk, and his role in the Trump administration are negatively impacting the company’s standing on Wall Street. The JPMorgan team, led by Ryan Brinkman, has slashed their first-quarter delivery forecast for Tesla by 20%, from 444,000 to 355,000. This figure is significantly below the consensus analyst projection of 430,000, reported Forbes.

The analysts predict Tesla’s lowest deliveries since the third quarter of 2022, marking an 8% decline from the first quarter of 2024. They attribute this downturn to the “acute” effects of Musk’s “more divisive new role in government,” referring to his critical position in the Department of Government Efficiency (DOGE).

Brinkman also highlighted that Tesla’s European sales are under considerable strain due to Musk’s remarks on the Ukraine war, U.S. participation in NATO, and far-right political groups, leading to a 50% year-on-year drop in new Tesla vehicle registrations in January.

"We struggle to think of anything analogous in the history of the automotive industry, in which a brand has lost so much value so quickly," wrote JPMorgan in its analyst note.

The analysts noted that among American car companies, “Tesla appears to have the most to lose” from the “shifting regulatory backdrop” under Trump, the possible reversal of electric vehicle tax credits.

Why It Matters: JPMorgan’s $120 share price target for Tesla is the lowest on Wall Street, implying a more than 50% downside from Tesla’s closing price on Wednesday at $248.0 ticker. This follows similar first quarter delivery forecast reductions for Tesla by other major firms like Goldman Sachs and UBS.

This prediction aligns with earlier forecasts by Gene Munster, Managing Partner at Deepwater Asset Management, who anticipated a 5% decline in Tesla deliveries in 2025 before a 40% surge in 2026.

Moreover, Dan Ives, head of technology research at Wedbush Securities, previously expressed concerns about Musk’s dual roles at Tesla and DOGE, stating that the current leadership situation at Tesla is “unsustainable” for shareholders.

Tesla stock climbed 7.59% on Wednesday following President Donald Trump’s purchase of a Tesla vehicle to show support to Elon Musk.