Wedbush's Daniel Ives, a longtime Tesla (NASDAQ:TSLA) bull, has lowered his price target on the electric vehicle maker by 43%, citing mounting concerns over U.S. tariffs and Elon Musk's polarizing public image.

In a note sent to clients late Sunday, Ives said Tesla is facing a perfect storm of macro and brand-specific headwinds. While maintaining his buy rating, Ives cut his target from $550 to $315, the lowest among major Wall Street analysts. Despite the revision, the new target still implies over 30% upside from current levels.

Tesla stock has declined more than 40% year-to-date and was trading nearly 8.4% lower in pre-market hours Monday. Ives said Tesla would be less directly impacted by the new 25% U.S. auto tariffs than some rivals, but warned of a clear cost increase tied to Chinese parts.

The bigger concern, he noted, is reputational damage in China, which contributed roughly 20% of Tesla's revenue in 2024. With consumers potentially turning to local electric vehicle makers such as BYD (BYDDY), Nio (NYSE:NIO), and XPeng (NYSE:XPEV), Ives called China the linchpin of Tesla's growth story.

He said the geopolitical fallout could drive buyers away from Tesla and toward domestic alternatives. The analyst also urged Musk to consider stepping back from politically charged roles, such as the Department of Energy Efficiency committee, to prevent further stock pressure.

Despite the lowered forecast, Ives remains optimistic about Tesla's upcoming rollout of Full-Self Driving and its new lower-priced models. Still, he emphasized that Musk must act quickly to stabilize the brand or risk deeper fallout in the months ahead.

It is important to note that Tesla's stock is down a stark 40.7% year-to-date, overshadowing the stock's early upward momentum. We saw a quick surge in late January, followed by a sharp pullback in mid-February. The stock rallied briefly in early March but faded again as the quarter progresses.

By late March, the overall trend remained downward, underscoring persistent volatility. Taken together, these swings define a choppy trajectory that has kept investors on edge throughout the year.