— Gordon Johnson (@GordonJohnson19) February 18, 2025 Johnson has long criticized Tesla’s (NASDAQ: TSLA) valuation and growth projections, arguing that the company faces slowing demand and increasing competition, particularly in China. Indeed, with Tesla witnessing waning sales in the Asian economic giant, Johnson had previously cautioned that the Texas-based EV giant would likely ‘implode’ in 2025. Tesla’s struggles in China It’s worth noting that Tesla sold 63,238 vehicles in China in January, including exports, marking an 11.49% decline year-over-year and a 32.56% drop from December’s 93,766 units. Tesla introduced an RMB 8,000 ($1,100) insurance subsidy for the Model 3 earlier this month to boost demand. Additionally, the company will begin delivering the refreshed Model Y in February, earlier than planned. The insured units metric, which tracks the number of new vehicles registered for insurance, often indicates actual deliveries. While the latest weekly figures showed a slight rebound, the overall decline in sales suggests potential demand challenges. Notably, Tesla’s recent headwinds have particularly emerged from growing competition from Chinese EV makers, who continue to hold a significant grip on the market. For instance, from February 10 to February 16, BYD’s insurance registrations reached 46,800, up 61.94% from 28,900 the previous week. In January, the company sold 300,538 new energy vehicles (NEVs), a 49.16% year-over-year increase, though down 41.62% from December’s 514,809 units. At the same time, BYD unveiled its vehicle intelligence strategy, aiming to introduce smart driving features in its affordable models. This comes at a time when Tesla is seeking to scale its Full Self-Driving (FSD) technology, which has been touted as a key growth driver for the future. Tesla’s domestic challenges However, Tesla’s technology faces a significant challenge, as its Autopilot feature has been linked to 52 confirmed and 55 claimed fatalities, with two recent deaths involving FSD. In 2024 alone, seven fatalities were reported since FSD’s wider rollout. Meanwhile, trends from China are contributing to TSLA’s increased volatility as the company faces additional headwinds. Most recently, investors have turned pessimistic, given CEO Elon Musk’s new government role. Tesla has seen a notable capital wipeout as investors question Musk’s commitment to the firm, considering he has other roles at SpaceX, X, and xAI. TSLA stock price analysis By press time, TSLA’s share price was valued at $355.06, down almost 0.2% since the last trading session. Year-to-date, TSLA has dropped over 12%, invalidating the gains triggered by the post-election rally that saw the equity target the $500 resistance level. TSLA YTD stock price chart. Source: Finbold To reverse the current bearish trajectory, Tesla needs to focus on boosting demand through options such as pricing strategies, improving vehicle competitiveness, and addressing safety issues with its FSD technology. Most importantly, Musk must reassure investors of his commitment to the company, helping Tesla retain its dominant market position. Featured image via Shutterstock