Tesla is a central player in the (Electric) Vehicle industry, with its fortunes often rising and falling in line with both its products and the profile of its CEO, Elon Musk. The company enters the second half of 2025 at an important point: (EV) subsidies are being phased out in the US, competition from Chinese and European manufacturers is intensifying, and Tesla’s brand has taken damage from Musk’s political activities. Despite these challenges, the company continues expanding into new markets. The big question is whether Tesla can resume the growth surge seen in previous years.
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KEY CATALYSTS FOR TESLA’S PRICE MOVEMENTS IN 2025
Tesla’s share price this year has been impacted by a number of factors. On the positive side, the launch of its robotaxi service in Austin, Texas, and expansion into Arizona was an important step in Tesla’s move from a carmaker into a ride service operator. Early adoption rates, created optimism about future revenue streams beyond car sales. The move into new markets such as India, and recent huge interest shown by Gulf Arab states have also caused great optimism.
On the downside, Tesla has had to face the wind-down of federal EV subsidies in the US, reducing its pricing advantage. The company has also faced stiffer competition; Chinese rivals such as BYD continue to offer more affordable models, pressuring Tesla’s margins.
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CEO MUSK’S ENTRY (AND EXIT) FROM POLITICS AND THE TRUMP CONNECTION
Elon Musk’s profile in US politics rose during 2024 and into early 2025, via his support for Donald Trump. Musk’s attendance at campaign rallies, endorsing of Trump’s economic and social agenda, divided Tesla’s customer base. While some buyers rallied to the brand, others—particularly in areas of strong sales for the company—expressed their opposition.
Public protests, including reports of Tesla cars being vandalised took place in the first half of the year. Critics argued that Tesla was no longer an apolitical technology company and had instead become an extension of a political movement. The controversy weighed the brand and sales in key liberal markets such as California and New York.
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WITHDRAWAL FROM POLITICS AND TESLA’S ‘DETOX’
Musk stepped away from frontline politics by mid-2025, and distanced Tesla from Washington. Without the shadow of partisan political arguments and also by reassuring investors that his future was fully committed to Tesla, early signs suggested a recovery in US orders in areas where sales had stagnated during the political controversy. By shifting focus back to Tesla’s values of technology, and clean energy, Tesla has regained some of its lost neutrality and repaired brand damage.
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STOCK PRICE MOVEMENTS: POLITICS AND BEYOND
Telsa’s stock price underperformed the Nasdaq and S&P 500 during Musk’s most visible involvement with Trump. However, since Musk’s step back from politics in the summer of 2025, Tesla stock has staged a recovery, with analysts pointing to improved market confidence. The recovery was further buoyed by Musk’s own decision to purchase $1 billion worth of Tesla shares in September 2025, signaling his renewed focus and long-term commitment to the company. In the latter part of September Tesla’s stock price hit its highest level in 2025.
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THE CHALLENGE OF EV SUBSIDY PHASE OUT
The end of US EV subsidies has been tough for Tesla. To cope, it’s cut costs and boosted efficiency at its Texas and German plants. Still, without subsidies, Teslas often cost more than Asian rivals. To balance this, the company is leaning on software like—autonomous driving and its new robotaxi network—shifting profit from cars to services.
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EXPANDING MARKETS AND GLOBAL OPPORTUNITIES
With the US market facing some headwinds Tesla has pushed into new markets. India is a priority for the company, in a country at the beginning of the EV revolution. The German Gigafactory is making Model Y and Cybertrucks for the continent. Energy storage in Australia and elsewhere shows momentum. These types of opportunities may help to offset the loss of subsidies in the US.
Conclusion –
For now Tesla’s strategy appears to be working. The company’s robotaxi rollout, its global expansion, and its diversification into energy storage are promising signs of resilience. While the end of EV subsidies and global competition remain challenges, Musk’s decision to retreat from politics has improved Tesla’s image and has coincided with a solid recovery in its share price, leaving investors more optimistic.