| Thanks for reading Hyperdrive, Bloomberg’s newsletter on the future of the auto world. Wall Street, We Have a Problem | On March 6, Wedbush Securities added Tesla’s stock to its “best ideas” list. The shares had just closed at $263.45, their lowest in four months, and analyst Daniel Ives reiterated his view that they were headed to $550. “Table pounder here,” Ives wrote for emphasis in the title of his report. Wedbush was estimating then that less than 5% of Tesla sales globally were at risk from what he referred to as “the elephant in the room” — the potential for Elon Musk, the Department of Government and Donald Trump to damage Tesla’s brand. Ives downplayed the extent to which the Tesla CEO’s work for the White House would continue to pull him away from the carmaker, saying he expected Musk “will better balance his time” between DOGE and his companies over the course of the year. “We continue to believe the best thing that ever happened to Musk and Tesla was Trump in the White House,” Ives wrote. Less than a month has passed since Ives offered that view, and he’s steadily second- guessed his positions. “Patience wearing very thin,” Ives wrote in the title of a March 11 report. “Tesla is going through a crisis,” he declared nine days later. After Tesla this week reported its worst quarterly sales since 2022, Ives seemed downright despondent. “Need to navigate brand crisis or else,” he blared in the subject line.  Musk and Trump at a rally in Washington ahead of the presidential inauguration in January. Photographer: Bloomberg/Bloomberg In fairness, Ives was far from the only Wall Street analyst who took the degree of Musk’s destruction for granted. No doubt, Tesla’s changeover to the redesigned Model Y was a major factor in the company’s awful first quarter. But it’s not normal for people to be picketing outside showrooms, spraying paint on storefronts and even setting cars ablaze. Many consumers considering which brand to go with when making what tends to be their second-most expensive purchase, after their house, are going to think twice about a Tesla until and unless the fury around Musk dies down. On Friday, one of Ives’ most bearish counterparts admitted that even he had under miscalculated. “Tesla’s 1Q sales and production report causes us to think that — if anything — we may have underestimated the degree of consumer reaction,” JPMorgan’s Ryan Brinkman wrote in a report. JPMorgan now expects Tesla’s first-quarter earnings to slip to 36 cents a share, short of its previous projection of 40 cents and analysts’ average estimate of 46 cents. Brinkman also trimmed his full-year earnings projection to $2.30 a share. Analysts surveyed by Bloomberg are on average estimating the company will earn $2.70 per share — and Brinkman notes that this figure had dropped 17% since Tesla last reported quarterly earnings in late January. Some of Ives’ and Brinkman’s peers still need more convincing. “Several media reports and investor inquiries we have received have pointed to demand destruction and brand deterioration,” Ben Kallo at Baird wrote this week. “While this very well may be a factor driving lower deliveries in certain regions, we believe additional data points are needed to confirm and expect these narratives to continue in the near term.” Alexander Potter at Piper Sandler was even more dismissive. “While journalists are seizing on the opportunity to write about arson, we think the investing community risks losing sight of Tesla’s upcoming product unveilings, as well as the impending robotaxi launch in Austin,” he wrote. Ives hasn’t budged on his price target, even as Tesla has sold off another 10% from where it closed on March 6. “This is a fork-in-the-road decision,” he wrote. “Musk needs to get his act together, or else unfortunately darker times are ahead for Tesla.” For More on Musk and Tesla |  Infiniti QX50 SUVs at the Port of Los Angeles. Photographer: Bing Guan/Bloomberg In more fallout from President Trump’s sweeping tariffs on auto imports, Nissan stopped taking orders for two Mexico-made Infiniti SUVs in the US; roughly 6,000 workers were laid off in Canada, which announced retaliatory levies on US cars; and French materials producer St. Gobain decided to hold off on a sale of its auto-glass unit, which could have fetched as much as €2.5 billion ($2.8 billion). | 
