Updated Wed, Oct 15 2025 3:23 PM EDT Squawk Box Asia Steve Greenfield, general partner at investment firm Automotive Ventures, said the retreat of legacy automakers from the segment could be good news for Tesla as its market share may start to rebound. He said in an email that the company has "very strong brand loyalty." "Chances are, most Tesla buyers will continue to stay in the brand, as they buy their next new car," Greenfield said. However, significant challenges loom. Interest in battery electric vehicles "is very likely to shrink dramatically" in the fourth quarter, he said, due to the "pull-ahead of demand," as consumers rushed to buy EVs before the credit expired. As the year ends, Tesla will likely face a "double whammy," Greenfield said, from reduced BEV sales and lower margins on the cars they do sell. Tesla didn't respond to a request for comment. Investors have become more bullish. Following a 36% slump in the first quarter, the stock has rallied and is now up more than 7% for the year, aided by Musk's purchase of about $1 billion worth of Tesla stock in September. The brutal start to the year was linked to a consumer backlash in the U.S. and Europe in response to Musk's incendiary political rhetoric, his work for President Trump slashing the federal workforce, and his endorsements of far-right groups including Germany's AfD party. Sharing in the pain In the company's third-quarter earnings scheduled for next Wednesday, analysts are expecting to see revenue growth of 3.5% from a year earlier to $26.1 billion, according to LSEG. Analysts are projecting a revenue drop in the fourth quarter and a 3.5% slide for all of 2025, which would mark the first full-year decline on record. Earlier this month, Tesla reported a 7% year-over-year increase in quarterly vehicle deliveries for the third quarter. That marked a turnaround after two consecutive quarterly declines to start the year. "It's not just a retreat of everybody else, and Tesla gets to run away with the market," said Mark Wakefield, global automotive market lead at Alix Partners, in an interview. Consumer demand for fully electric vehicles had "already kind of flatlined a bit" even before the Republican spending bill, Wakefield added. Car buyers have been looking for a "breakthrough moment" where EVs would become cost competitive with hybrid or gas-powered models. Wakefield added that "this market needs a sense of newness," and that the new, lower-priced Model Y and Model 3 options are not exactly "earth shattering." The Trump administration isn't making life easy. Robbie Orvis, a senior director at Energy Innovation, a nonpartisan climate policy think tank, told CNBC the automakers' writedowns were expected and stem entirely from policy changes beyond just the tax credits. The Trump White House has also "revoked California's waiver to set its own vehicle standards, revoked billions in funding for EV chargers and for auto plants to retool to build EVs, and is in the process of undoing vehicle tailpipe standards that would encourage the adoption of EVs," Orvis said. Those policies, along with tariffs, have already caused billions of dollars in losses for U.S. automakers, which means they aren't in a position to invest in new market segments, Orvis said. Tesla is experiencing its share of that pain, and it's showing up most acutely in international markets. "Chinese automakers are rapidly displacing U.S. automakers in foreign markets as they are able to offer cheaper, higher-quality new cars, particularly EVs, in markets where there is large and growing demand for these cars," Orvis said. The Tesla Bot humanoid robot of Tesla ''Optimus'' is displayed at the 2023 World Artificial Intelligence Conference in Shanghai, China, July 6, 2023. Costfoto | Nurphoto | Getty Images