Tesla’s brand image has taken a significant hit in recent months. For at least a decade, Tesla was the darling of the burgeoning global electric vehicle segment. After launching the Tesla Roadster in 2008 and demonstrating the viability of mass market battery electric vehicles (BEVs), Tesla remained the most dominant player in the EV sector for most of its existence.
Until very recently, Teslas were among the most popular electric cars on the global market, and the Tesla Model Y was the bestselling EV worldwide in 2024. However, 2025 has proven to be a disastrous year for the Texas-based electric vehicle firm. Consumers in several key markets are turning away from the once-beloved automaker.
Consumer sentiment regarding Tesla has fallen to such a degree that it is the only vehicle brand that is distrusted by over 30% of customers of all partisan affiliations. Tesla currently has a -7% net favorability score, and 39% of American residents hold a negative view of the EV brand compared to 32% of residents who have a positive view.
Additionally, 55% of U.S. residents said they are not likely or would never consider purchasing a Tesla compared to 44% who said they are considering or open to buying a Tesla. The company’s brand image has suffered even more outside the U.S. In Europe, the second largest electric vehicle market in the world after China, drivers are turning away from Tesla in droves.
Despite increased EV registrations on the continent, Tesla registrations in Europe dropped by 49% through January and February 2025 as customers in several key European markets boycotted the brand. Tesla registrations in Sweden, Germany, and the UK fell by over 80%, 46%, and 68% respectively, while France registered a more than 59% drop in demand for Tesla vehicles.
Fierce competition from China, where automakers are manufacturing and selling affordable EVs at a profit, is also forcing Tesla to cede ground in the Chinese and European markets. The company is also facing increased scrutiny from federal regulators who aren’t convinced of the safety and feasibility of Tesla’s promised but yet-to-be-delivered Robotaxis.
Although Tesla still hasn’t conducted driverless tests for its Robotaxis, regulators are pushing the automaker to show how the Robotaxis could operate safely in challenging and low-visibility weather conditions like rain, sun glare, and fog.
With a battered brand image, declining demand, rising competition, and growing regulatory pressure, Tesla is facing challenges that threaten its dominance in the EV sector, and perhaps even its long-term survival. How the company navigates this turbulent period will determine whether it remains a market leader or fades into the background of a rapidly evolving industry.
As Tesla’s grip on the EV market loosens, all eyes will be on emerging players like Mullen Automotive Inc. (NASDAQ: MULN) that are focused on making their mark on this rapidly-evolving industry.
NOTE TO INVESTORS: The latest news and updates relating to Mullen Automotive Inc. (NASDAQ: MULN) are available in the company’s newsroom at https://ibn.fm/MULN
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