Analysts at the investor advisory site Seeking Alpha published a piece on Tuesday in which they claim that Tesla could be facing what they call a “Blackberry moment” caused by a combination of political and market factors.
This article and the ongoing negative impacts on Tesla’s business fortunes are signs of just how much Elon Musk is sacrificing as he heads up the DOGE operation for the Trump administration.
The “Blackberry moment” analogy refers to the Blackberry communications device which dominated the personal handheld market for a decade until 2007, when Apple introduced the first iPhone. Blackberry, having failed to properly assess the market and to innovate to take advantage of evolving technologies, suffered an immediate, rapid decline from that moment forward.
I’ve been a critic of Tesla myself and am not a fan of electric vehicles in general due to their chronic limitations the industry has never successfully addressed despite having been in existence since the 1890s. Relevant to this analogy, I wrote a piece in 2023 in which I observed that Tesla body designs that seemed so innovative and even breathtaking a decade ago had become stale and were in need of updating. I still believe that to be the case.
I’ve also been a real critic of the Cybertruck’s exterior design, which is so radical that it without question limits its appeal to all but a small, wealthy subset of Americans who are far more interested in the virtue signal involved in owning one than in the real functionality of owning a pickup truck. Sales of the Cybertruck have been ok so far, but just ok, and seem destined to decline as the audience for them fades.
On the other hand, Tesla remains far and away the most successful U.S. electric vehicle maker, and, as Seeking Alpha points out, even after its recent decline in stock price still sports a market cap that exceeds that of the next 9 automakers combined.
That’s astonishing.
But Tesla’s current $766 billion market cap is a 50% decline from the company’s value just three months ago, and Seeking Alpha correctly points out that it is a pace of decline that is wholly unsustainable. Unfortunately for Tesla and Musk, the stagnating overall market for EVs in general means that a recovery is going to be hard to affect.
The Seeking Alpha authors conclude the piece with this assessment: “TSLA is a sell as protests and a collapse of brand image usher in an era of declining sales to be matched by a decline in investor sentiment.”
Oof.
The utter depravity of Democrat politicians, like Minnesota Gov. Tim Walz and Texas Rep. Jasmine Crockett, who this week gleefully encouraged the increasingly violent and obviously organized campaign against what is undeniably a great, uniquely American success story cannot be overstated. These and others who egg this campaign of domestic terrorism on should be ashamed and shunned by polite society.
Unfortunately, they are far from alone, and no Democrat elected official has overtly condemned the assault on Tesla to date.
Tesla was already struggling with market factors dictated by slipping demand for EVs in general before domestic terrorists began to mount this campaign against the company. Now, with the virtue signal aspect of its appeal in steep decline among America’s liberal class which has served as its main customer base, those problems have been multiplied.
So, is Tesla facing a real Blackberry moment? Here, it’s important to point out that that would require some innovative alternative EV company which incorporates new technologies that Musk and Tesla have failed to adopt.
If any such alternative exists today, it hasn’t been made apparent. In fact, most of Tesla’s U.S. competitors are either in bankruptcy or teetering on the brink. Plus, given the reality that the vast majority of real innovations in the EV space for more than a decade have been developed by Tesla itself, the rise of any such competitor anytime soon seems like a real pipe dream.
Tesla is definitely under siege and far from healthy right now, but rumors of its impending demise seem wildly overstated.
David Blackmon is an energy writer and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.
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