In its quest for a tune-up, Tesla, the electric vehicle company led by Elon Musk, finds itself grappling with significant challenges. The company's shares have plummeted over 25% so far this year, making it one of the worst-performing stocks in the S&P 500. This decline translates to a loss of more than $200 billion in market value in less than four months.

The primary factors contributing to Tesla's struggles include shrinking car sales, setbacks in autonomous driving, and increased competition. The company's failure to release an affordable new model, coupled with a general slowdown in the electric vehicle market, has created a difficult path for Tesla to regain its previous breakneck growth.

Industry analysts have varying opinions on whether Tesla can recover these losses. Critics contend that the company's failure to release a new, budget-friendly model has resulted in a decline in demand, while competitors have introduced alternative options. They argue that Tesla's current capacity exceeds the demand for its cars, resulting in its struggle.

On the other hand, proponents point to Tesla's history of industry-leading innovation and believe that the breakthroughs that propelled its success in the past could resurface as the company prepares to launch new electric vehicle models and perfect its autonomous driving software.

Notably, Tesla recently reported a significant decline in car sales for the first quarter of 2024. The company delivered 387,000 cars during this period, which marks a 20% decline from the previous quarter and an 8% decline year-over-year. The underwhelming results fell short of Wall Street expectations.

Tesla attributed the sluggish performance to preparations for the production of a forthcoming version of its Model 3, as well as shipping delays in the Red Sea and an alleged arson attack at its Berlin factory. However, industry experts remain skeptical, arguing that declining sales revenue and persistent costs could potentially force Tesla to seek external funding.

The autonomous driving software, a key aspect of Tesla's long-term growth potential, has also faced challenges. The company issued recalls for approximately 2 million cars in December due to a safety issue linked to its autopilot system. Two months later, an additional 360,000 cars were recalled due to crash risks associated with its self-driving system.

The road to recovery appears uncertain, as analysts emphasize the need for sales to reaccelerate and for Tesla's full self-driving feature to see greater adoption. Despite the skepticism, some analysts believe that Tesla can overcome this crisis through innovation and regain its previous growth trajectory.

As Tesla grapples with these challenges, investors and industry experts are closely monitoring the company's trajectory. The electric vehicle giant's ability to adapt, innovate, and regain investor trust will play a significant role in determining its future success.

Tesla did not immediately respond to requests for comment regarding the issues faced by the company.

While the outcome for Tesla remains uncertain, industry observers suggest that this period marks a critical juncture for the company's future prospects.