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Tesla (TSLA) shares are in the red this afternoon after the automaker stopped taking new orders for two of its flagship electric vehicles in China.
The company says it is no longer entertaining news orders for its Model S and Model X in the world’s largest auto market after President Xi Jinping slapped raised retaliatory tariffs to 125% on U.S. imports.
Beijing’s tariffs announcement is significant for TSLA as it makes both of those flagship models in the United States.
TSLA Has Been Hit With a Triple Whammy of Headwinds
TSLA shares have already lost more than 40% from their year-to-date high, but Steve Westly, a former board member of the EV giant, is not entirely convinced that the worst is over just yet.
Why? Because the company has been hit with a “triple whammy” of headwinds, he told CNBC in a recent interview.
Tesla has been a laggard in launching new products, it’s been caught in the crosshairs of a political firestorm, and finally, competition from Chinese rivals, especially BYD (BYDDY) has exploded in recent months.
And now, in addition to all of that, TSLA stock has to deal with the escalating U.S.-China trade war that’s “not going to help them one bit,” Westly added.
Tesla Has Been a Laggard in Autonomous Vehicles
Steve Westly took a dovish tone on Tesla stock in his CNBC interview because the only product it has launched since 2020 (Cybertruck) has been a flop, he says.
Plus, the automaker is losing to Waymo in autonomous vehicles, given the Google (GOOGL) brand recently announced 200,000 rides per week. Meanwhile, TSLA is “not in the ball game yet.”
Even BYD has unveiled an advanced driver assistance system (ADAS) called “God’s Eye” that it’s offering in its vehicles for free – versus $9,000 for Tesla’s full self-driving (FSD).
So, “Tesla’s got some work to do to be competitive in FSD,” Westly concluded.
Analysts Have Been Lowering Price Targets on Tesla Stock
Wall Street has also been trimming its price target on Tesla stock in 2025.
Nonetheless, analysts are not as dovish on TSLA as Steve Westly. The mean target on the EV stock still sits at $309, indicating potential upside of about 24% from current levels.
