Tesla is facing significant challenges this year, largely tied to decisions made by its CEO, Elon Musk. Following an investment of nearly $290 million aimed at supporting Donald Trump’s political ambitions, Musk found himself in controversial waters. His leadership role in the newly established Department of Government Efficiency (DOGE) prompted drastic proposals to reduce federal agencies and social programs, igniting global protests outside Tesla showrooms. Many of the company’s liberal customers—once its strongest advocates—now feel alienated and are expressing regret over their purchases.
This backlash has been severe. In the first quarter alone, Tesla experienced a 13% decline in global sales, with net income suffering an eye-watering 71% drop to $409 million compared to last year. Additionally, the company’s stock plummeted over 20% since the beginning of the year. Early data suggests that this downward trend may continue, resulting in deep and enduring reputational damage for Tesla, despite Musk’s recent fallout with the president and his departure from government.
However, a potential lifeline may be on the horizon as Tesla sets its sights on India. According to a recent Bloomberg report, the automaker plans to open its first showroom in Mumbai by mid-July, with another one aimed for New Delhi soon after. The initial shipment of vehicles—primarily the popular Model Y SUV from China—has already arrived in the country. This strategic pivot focuses on tapping into the third-largest auto market globally, which could help counter declining demand in Europe and increasing competition from rivals like BYD.
Historically, Tesla’s efforts to penetrate the Indian market faced hurdles related to local manufacturing requirements and pricing disagreements. However, this situation appears to have changed following Musk’s meeting with Indian Prime Minister Narendra Modi during a state visit to Washington in February. The two leaders maintained communication, discussing potential collaboration in technology and innovation.
Spoke to @elonmusk and talked about various issues, including the topics we covered during our meeting in Washington DC earlier this year. We discussed the immense potential for collaboration in the areas of technology and innovation. India remains committed to advancing our…
— Narendra Modi (@narendramodi) April 18, 2025
It was an honor to speak with PM Modi.
I am looking forward to visiting India later this year! https://t.co/TYUp6w5Gys
— Elon Musk (@elonmusk) April 19, 2025
As Tesla revises its narrative in this massive, untapped market, one must wonder: will this shift in focus be enough to mend the damage inflicted at home?
What are the main reasons behind Tesla’s decline this year? The combination of unorthodox political involvement and resulting customer backlash has severely impacted sales and brand reputation.
How is Tesla planning to succeed in the Indian auto market? The company aims to establish showrooms and leverage strategic partnerships, particularly focusing on the popular Model Y SUV to win over Indian consumers.
What challenges has Tesla faced when trying to enter India? Historically, the automaker encountered issues with local manufacturing requirements and price negotiations, which now appear to be resolved thanks to high-level discussions.
Will Musk’s visit to India help improve Tesla’s performance? It’s too early to tell, but high-level talks and a commitment to collaboration signal potential optimism for Tesla in the region.
Seeing a company pivot strategically to explore new markets like India could indicate a hard-earned chance at revival. It’s a crucial moment for Tesla, and its success here may just be the change the company needs. For more insights and updates related to Tesla and the automotive industry, explore further content at Moyens I/O.