The global electric-vehicle market is moving slowly. Tesla's estimated deliveries show a modest gain, but the company once delivered nearly 500,000 vehicles in its best quarters. That peak is still out of reach.
One reason: Tesla's brand took a hit last year. The controversy stemmed from Elon Musk's involvement with the Trump administration's initiative to reduce spending. That damage is now easing, but it took time for sales to recover.
The decline in 2025 followed a series of controversies surrounding Musk's public activities, including his role in the federal cost-cutting effort. While European subsidies and Chinese production have buoyed recent results, the loss of U.S. tax credits has weighed on domestic demand.
A newly introduced German subsidy for battery-powered cars boosted demand. "Part of the success they're having is the brand improving," said Gene Munster, managing partner at Deepwater Asset Management.
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In China, Tesla's Shanghai factory saw a 39% increase in shipments in May 2026, according to preliminary data from the country's Passenger Car Association. That factory is a key part of Tesla's global production.
However, analysts expect U.S. deliveries to decline, dipping below even the already low second-quarter figures from 2025, following the Trump administration's removal of electric vehicle tax credits last year.
Investors are looking beyond car sales. They are focused on Tesla's projects in artificial intelligence, autonomous driving, and robotics. Another big factor: a possible merger with SpaceX after its massive initial public offering in June 2026.
Some analysts think Tesla shares could become "SpaceX trackers" if a merger ratio is locked in, said Philippe Houchois, an equity analyst at Jefferies. TD Cowen also issued a note about "a strong June finish" that could lift the stock in the short term.
Tesla plans to spend roughly $25 billion on capital investments in 2026, about three times its outlay from the prior year. That spending is a bet on future growth, but it also raises the stakes for Tesla's next moves.
Watch for Tesla's final delivery numbers later this month. A strong finish to June could boost the stock. The bigger story remains the company's shift toward AI and a potential SpaceX merger.
The road ahead for Tesla is still uncertain.
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