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Tesla Faces Decline as EV Tax Credit Expires
Tesla (NASDAQ: TSLA) reported a 16% decline in revenue for the second consecutive quarter in its Q2 earnings on July 23, 2025. The company’s stock has fallen 45% year-to-date, dropping to a low of $214 in April. As of early September 2025, Tesla shares were down 16%, making it the poorest performing stock among mega-cap companies.
The federal electric vehicle (EV) tax credit is set to expire on September 30, 2025, which is anticipated to impact Tesla significantly. The current credit provides up to $7,500 for new EV purchases. In 2024, the U.S. government spent over $2 billion on these credits for more than 300,000 EV purchases, and a study predicts a potential drop in EV sales by nearly 30% if these credits are removed.
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