Tesla shares fell roughly 5% to $423 on May 12 as operational problems with its commercial Robotaxi service in Dallas and Houston collided with news that Panasonic battery deliveries were running behind schedule, according to 247 Wall St.
The selloff tests how much of TSLA's valuation is still held up by the autonomous-vehicle premium. Musk's departure to Beijing as part of President Trump's China delegation added a diplomatic subplot: FSD approval in China could be the Robotaxi program's largest near-term growth unlock.
What happened
Users in Dallas and Houston reported extended wait times and mid-ride cancellations from Tesla's Robotaxi fleet during the week ending May 12, per 247 Wall St coverage. Separately, Panasonic's timeline for next-generation battery cells faced a delay that could slow Tesla's cost-reduction roadmap. Musk traveled to Beijing alongside the Trump delegation, with Tesla seeking Chinese regulatory clearance for Full Self-Driving software — an approval that has been in limbo for months because Beijing requires data-localization compliance.
Why it matters
Tesla's current premium to legacy automakers is almost entirely based on autonomous and AI expectations, not on vehicle margins. When those execution timelines slip — whether through fleet reliability problems, battery sourcing, or regulatory delay — the market has little slack in the valuation to absorb bad news. The stock was trading near $445 before the drop, meaning $423 represents a nearly $70B loss in market cap in a single session.
Market impact
The 5% decline on May 12 put TSLA at its lowest point in two weeks. Motley Fool's prior-day analysis noted that investors were already debating whether to buy before the Robotaxi expansion, suggesting the operational disappointments landed on an already-uncertain setup. Rivian and Lucid, which do not carry an autonomous premium, were largely unaffected, underlining that this was a Tesla-specific story rather than a broad EV selloff.