Tesla, Inc. (NASDAQ:TSLA) finds itself in a precarious position as it faces an unprecedented eight-week losing streak, the longest in its history, raising questions about what lies ahead for both the company and its investors. As of March 19, 2025, concerns surrounding Tesla's stock were compounded by recent discussions on CNBC’s Squawk on the Street, where financial expert Jim Cramer weighed in on how external factors, including President Trump's latest tariffs, influence market dynamics.
Cramer, known for his insights on market behaviors, shared his views during an episode air date on March 20, 2025, echoing a common concern among investors about the potential repercussions of increasing tariffs. "If you try to make Jack Daniel’s expensive, everything you sell us is just gonna be too expensive and we’re all gonna be drinking Kim Crawford," he expressed, implying that these tariffs could inflate prices across the board, ultimately harming consumers.
The backdrop of Cramer’s analysis comes after the S&P index experienced a staggering drop of $4 trillion from its post-election high on March 17, 2025. Such a decline has left many investors feeling anxious about the market's direction and the implications of economic policies on industries sensitive to tariffs, particularly in the automotive sector.
Jim Cramer has not been shy about his concerns regarding President Trump’s strategy, asserting that the President is creating uncertainties that do not help the situation. He humorously noted that for one day the market enjoyed a reprieve from presidential posts, and it thrived during that brief period. This reinforces the notion that the market is vulnerable to the President's communications, which Cramer criticized as inflammatory placeholders that add to investor unease.
Amid this tumultuous backdrop, Tesla's stock pushed further down its downward trajectory. By March 19, shares of Tesla had lost nearly half their value since the prior December, leading to immense pressure on leveraged long ETFs like the Direxion Daily TSLA Bull 2X Shares (TSLL), which has plummeted 80%. In contrast, inverse ETFs such as the Tradr 2X Short TSLA Daily ETF (TSLQ) capitalized on this downturn, nearly tripling since Tesla’s peak.
The contrasting fortunes of these ETF options highlight the differing strategies investors employ as they navigate this rocky period for Tesla. With approximately 17 Tesla-related ETFs in the U.S. holding collectively around $4.8 billion in AUM as of mid-March, the stakes are significant for those looking to profit or mitigate losses in light of the changing market landscape.
The YieldMax TSLA Option Income ETF (TSLY), for instance, has reported a decline of about 55% since Tesla's peak, while newer offerings like the Battleshares TSLA vs. F ETF (ELON) and the STYKd 100% UBER & 100% TSLA ETF (ZIPP) have also quickly faced challenges, with losses of 63% and 19% respectively since their launch.
The mounting challenges for Tesla are reflected in various institutional holdings reports. On March 19, 2025, Cantor Fitzgerald upgraded their outlook for Tesla from Neutral to Overweight, indicating some enduring confidence among institutional investors. Notably, a total of 5,232 funds or institutions report positions in Tesla, as an increase of 17.57% from the last quarter suggests a growing interest in the company, despite the recent downturn.
Among the top holders, Vanguard, with its various funds, continues to support Tesla investments despite slight fluctuations in holdings. For instance, the Vanguard Total Stock Market Index Fund holds 85,489K shares, constituting 2.66% ownership of the company but reflecting a small decrease from previous holdings. Conversely, funds like J.P. Morgan Chase have increased their shareholdings significantly, illustrating a complex and varied institutional response to the volatile stock.
As Tesla ventures into new territory with autonomous vehicle narratives gaining traction amidst the stock plunge, Cramer lamented the misunderstanding surrounding tariffs and their implications. He stated, "People fear inflation and worry about their savings, which happens to be in many cases, the stock market." This sentiment reflects broader anxiety among consumers as well as investors, contributing to the declining consumer sentiment evidenced by recent survey results.
Ultimately, as Cramer posited, the stock market acts as a gauge of public sentiment—between hope and despair. “Think of the market as a gauge of hope versus despair. The results lately demonstrate despair,” he concluded, indicating a prevailing pessimism over current economic conditions that might test the resilience of stocks like Tesla.
With a ninth consecutive week of losses looming, investors in Tesla and its related ETFs are keeping an anxious watch for signs of a recovery or further declines that could reshape the environment for electric vehicle stocks. The upcoming decisions made by the U.S. government and the market's reaction to those tariffs will likely play a crucial role in determining Tesla's short-term fate as it navigates through uncharted waters.
