Tesla Faces Global Scrutiny: Will Investigations Impact Tesla Share Price After Q3 Report?

Tesla is once again in the spotlight as regulatory investigations, litigation, and pivotal updates to its Full Self-Driving (FSD) system shake investor confidence ahead of the highly anticipated Q3 2025 earnings report. With Tesla facing scrutiny from authorities in the US and abroad, and the “Tesla share price” reacting sharply to the latest headlines, investors and market watchers are questioning the company’s mid-term outlook. This article dives into Tesla’s latest news, evaluates the company’s recent operational performance, and provides an insightful forecast for the Tesla share price following the Q3 financial results on October 22.

Source: YahooFinance

Tesla’s Latest News: Investigations, Lawsuits, and FSD Upgrades Cause Market Volatility

Tesla is currently under intense global scrutiny, with regulatory bodies and legal authorities examining both its technological advances and its safety standards. On October 9, 2025, the U.S. National Highway Traffic Safety Administration (NHTSA) launched a major inquiry into approximately 2.88 million Tesla vehicles equipped with the Full Self-Driving (FSD) system. This Tesla-specific investigation follows over 50 reported events, including serious traffic violations and accidents linked to Tesla’s FSD software. These reports highlight potential risks such as running red lights and improper lane changes.

Among 58 examined cases, 14 resulted in accidents and 23 injuries, with six incidents involving Tesla cars running red lights and colliding with other vehicles. Some Tesla owners further alleged that the FSD system failed to properly detect traffic signals or stop on red, with concerns that Tesla has not sufficiently addressed these safety issues. Tesla’s official response is still pending as of this report.

This regulatory probe is still in its preliminary phase, but if the NHTSA determines the affected Tesla vehicles present a substantial safety risk, a widespread recall is likely. The news has already impacted the Tesla share price: by the market close on October 10, 2025, Tesla share price dropped to $413.49 USD, a 5.06% loss, with a market capitalization decrease of about $7.32 billion. Over the last five trading days, the Tesla share price has fallen by 3.80%.

Tesla’s regulatory and legal challenges are not limited to North America. Globally, Tesla is under legal pressure, including an ongoing NHTSA investigation into the Tesla Autopilot system, initiated in August 2021 in relation to at least 322 accidents. In August 2025, a Florida jury held Tesla liable for $240 million in damages over a fatal 2019 Autopilot-related crash, though Tesla attributes the incident to driver error and plans an appeal.

In China, the legal spotlight on Tesla intensifies: in June 2025, Tesla owners filed suit over hardware alleged to be incompatible with full advertised self-driving features, and in August, seven Tesla customers sued the automaker for fraud, seeking stringent compensation for claimed misrepresentations on Tesla’s part.

Tesla Recent Performance: Deliveries Rise, But Growth Faces Challenges

Despite these global headwinds, Tesla continues to highlight its safety and performance metrics. According to Tesla’s internal reports, vehicles using Autopilot or FSD recorded one accident every 6.69 million miles—significantly better than the industry average of one every 702,000 miles based on NHTSA and FHWA data. Tesla vehicles without driver assistance reported one collision per 963,000 miles.

In Q3 2025, Tesla delivered 462,890 vehicles globally—marking a 7% year-over-year increase. This uptick was partly due to a surge in U.S. purchases before federal EV tax credits expired in September. However, Tesla’s growth in Europe has faced strong competition from established automakers such as BMW, Volkswagen, and BYD, and has been further affected by market reactions to Tesla CEO Elon Musk’s high-profile public statements.

Financially, Tesla’s upcoming Q3 2025 earnings report (due October 22) is anticipated with caution. Analyst consensus projects Tesla earnings per share (EPS) at $0.37, representing a 40.3% year-over-year drop. For all of fiscal 2025, Tesla’s EPS is forecast at $1.20, down 41.2% from 2024; analysts expect a rebound to $2.01 in 2026. Still, Tesla’s share price has risen a remarkable 78.6% over the past 52 weeks, far outperforming the broader S&P 500 and sector benchmarks.

Tesla Share Price Prediction After Q3 2025 Earnings Report

Anticipation is high for the Q3 2025 financial results, as Tesla share price is expected to see significant movement. Historically, the Tesla share price posted positive one-day moves after earnings releases 63% of the time over the past five years (falling to 55% over the last three). On average, Tesla share price increases by 4.2% with positive post-earnings surprises, while losses following negative earnings hover around -6.1%.

Current Wall Street sentiment on the Tesla share price is largely “Hold,” as investors weigh the company’s strategic advantages against ongoing legal and regulatory uncertainties. Some analysts, such as Benchmark, remain bullish on the future of Tesla and the Tesla share price, maintaining a Buy rating with a $475 price target and expecting Q3 deliveries to tally around 442,000 units (slightly below consensus, but a strong recovery from Q2).

Ultimately, the trajectory for Tesla share price will be determined by Q3 financial outcomes, management’s future guidance, regulatory developments, and competition in key markets. Investors are strongly advised to review Tesla’s Q3 update and subsequent commentary to assess how Tesla will address safety investigations, regulatory compliance, litigation risks, and its roadmap for next-generation vehicle technology.

Conclusion

Tesla is navigating a complex environment of rapidly evolving technology, legal scrutiny, and intense market competition. While Q3 2025 and the subsequent weeks will be critical for both Tesla and the Tesla share price, investors should remain aware of both potential risks and opportunities in the coming months. Tesla’s ability to address regulatory concerns, sustain innovation, and maintain strong delivery numbers will be key factors influencing the Tesla share price.

Disclaimer: The opinions expressed in this article are for informational purposes only. This article does not constitute an endorsement of any of the products and services discussed or investment, financial, or trading advice. Qualified professionals should be consulted prior to making financial decisions.