Thinking of Buying Tesla Stock? Here Are 2 Red Flags to Watch

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Tesla’s intense dependence on Elon Musk adds great driving risks.
Increased competition from well -known car manufacturers and Chinese EV makers press Tesla’s hegemony.
Investors need to be comfortable to evaluate the high Tesla.
These ten shares can be shrouded in the next wave of millionaires ›

Timing (Nasdaq: tsla) The front running of the Electric Vehicle Revolution (EV) has always been in the United States, and has made it innovation, brand power and rapid growth preferred among investors.

However, despite its impressive record, there are two great dangers that investors care carefully before buying Tesla shares today.

Photo source: Getty Images.

ELON Musk is often referred to as the greatest strength of Tesla – and one of the paradoxes is one of the most important weaknesses. MUSK vision and practical training approach prompted TESLA technology and ambitious expansion. However, this intense dependence on one individual offers what investors indicate as “the main man’s risks”.

If Musk is back away from daily operations or converted its concentration into other projects, Tesla may face challenges in maintaining its momentum. Although the Tesla management team has become stronger, few executives lead the same vision, leadership and public interest as a musk.

Recently, Musk’s increasing participation in political activities has sparked concerns about possible deviations or reputable risks of Tesla. While the company remained strongly strong, these developments confirm the uncertainty about the continuity of its future leadership. Although the success of Tesla is not only with Musk but also with his team, which he was well executed for seeing-no one can build a trillion dollars alone-there is no clear successor (or a life-ahead management team). The silver lining here is that the Tesla plate has become more serious in finding one in recent months, largely due to the participation of the active CEO in politics.

For investors, this means that Tesla’s fortunes remain closely related to the presence and decisions of musk – a factor that adds a layer of risk to investment.

Tesla may have been an early engine in the EV industry, but its hegemony is no longer guaranteed. The industry scene is developing rapidly, as old car manufacturers and new expatriates accelerate their electrical ambitions.

Companies like Ford and General Motors It strongly expands their EV assortment. For example, Ford plans to offer a medium -sized truck worth $ 30,000 by 2027. This price is much lower than the EV, Ford invests $ 5 billion in EV production to achieve this. General Motors, on the other hand, is working hard on battery techniques from the next generation to improve the range and charging performance and cost.

At the same time, Chinese manufacturers are like Byd The effects of their international feet grow, especially in Europe, where Tesla witnessed nearly 27 % of sales in July 2025. Battery technology, government support, and competitive prices make it a huge competitor.

In addition, a group of EVs EV creates innovation in battery technology, self -ruling driving, and new business models, which increases intensive competition. While Tesla does not sit-it works to become a less expensive product by lowering prices to increase sales volume and achieve savings size-there is no guarantee that he can maintain its share in the market over time.

In short, he is no longer the only player in the city.

The story of Tesla remains convincing: she is a pioneer with a strong brand, innovative products and a potential option with some of her long bets (Robotaxi, Humanoid Robots, etc.). But the main man is the risks surrounding musk and the rising competitive scene of real concerns that investors cannot ignore.

If Tesla continues to innovate more quickly than its competitors, the company can maintain its growth path. However, any leadership or sliding changes in the market situation may harm work and the price of its share.

While these two dangers do not necessarily claim the sale of shares, they mean that investors should think carefully before buying shares today. Tesla shares are traded with a large evaluation to other car makers. For perspective, Tesla has a price rate (P/S) of 12.9, compared to 0.3 GM.

Unless you are comfortable with risks and high evaluation, buying shares today may not be a wise decision.

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Lawrence NGA is not a position in any of the mentioned stocks. Motley is a lie that has positions in and recommends Tesla. Motley Fool recommends a byd and General Motors. Motley Fool has a disclosure policy.

Thinking about buying Tesla shares? Below are red signs to see them originally published by Motley Cool

2025-08-17 15:14:00

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