'Facing a code red': Financial expert warns clients Tesla is teetering at edge of calamity

Tesla could be reporting a “code red” situation ahead of the company's latest earnings report is released Tuesday.

According to a financial expert, Tesla's stock has plunged so much it's facing calamity, according to a Bloomberg report — and the only solution for the company is have CEO Elon Musk “get back to work.”

Wedbush Securities analyst Dan Ives believes what's hurting the company most is Musk’s role at DOGE. “Musk needs to leave the government, take a major step back on DOGE, and get back to being CEO of Tesla full-time,” Ives wrote in a report to clients.

The analyst slashed his price target for Tesla’s stock by 43% because of what he perceives as a “brand crisis” created by Musk.

“Tesla is Musk and Musk is Tesla... and anyone that thinks the brand damage Musk has inflicted is not a real thing, spend some time speaking to car buyers in the U.S., Europe, and Asia. You will think differently after those discussions,” Ives told his clients.

The Tesla stock has lost about 44% of its value this year. Both Bloomberg and Ives reported that the contributing factor to the sales decline is from “consumer backlash against Musk.”

On Monday, the stock declined 6% within the first half hour of trading.

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On Friday, Reuters reported that the cheaper models of the Model Y have been delayed by several months. The low-cost car is now expected to be delivered in 2026.

Ives believes, “If Musk chooses to stay with the Trump White House, it could change the future of Tesla/brand damage will grow.” Adding, Tesla is facing a “code red” moment.

Musk is classified as a temporary federal employee and can only work for 130 days out of the year in his role. The co-founder of Tesla is expected to step back from his role at the end of his 130 term.