NEW YORK, July 24 — Tesla’s shares sank nearly 7 per cent in premarket trading today as the EV giant grapples with sinking sales and mounting doubts over its future under CEO Elon Musk, deepening investor anxiety after another shaky quarter.

Musk warned of a “few rough quarters” ahead for Tesla, as cuts in US EV incentives compound its challenges. The automaker reported one of its most difficult quarters in over a decade, marked by a second consecutive revenue slide.

This comes amid slumping EV sales, tariff pressures and fresh controversies around Musk, fuelling turbulence for the company at a time it can least afford it.

Tesla is working on a cheaper model, but Chief Financial Officer Vaibhav Taneja said production would ramp up next quarter, slower than initially expected. The company gave no update on its annual deliveries forecast, citing the economy and uncertainties looming over its rollout plans.

“Tesla is crossing the chasm to autonomy while absorbing slower volume, EV incentive elimination, tariffs and investing in new initiatives that may not make margins for years,” analysts at Morgan Stanley said.

The company’s trillion-dollar valuation hinges on its robotaxi ambitions, a small trial of which was started in Austin, Texas, last month with about a dozen Model Y SUVs, and its push to build humanoid robots.

Despite a recent facelift for its flagship Model Y, Tesla’s aging lineup is facing the heat from a wave of low-cost EV rivals, especially in China, and ongoing blowback over Elon Musk’s far-right political views.

“Musk is the face of Tesla, and for many people, the brand can’t exist outside of his influence. So, when his credibility and trust decline, so does the equity of the Tesla brand”, said Daniel Binns, Global CEO at Elmwood.

“In parallel, we’ve seen the EV market rapidly mature and Tesla is no longer the shining star,” Binns added.

Tesla’s stock is down about 18 per cent so far this year, making it the worst performer among the “Magnificent Seven” stocks. — Reuters