Electric vehicle (EV) manufacturers experienced a substantial decline in their stock prices, hitting fresh lows on Thursday. This downturn was largely attributed to a significant sell-off in the stock of Tesla Inc., the pioneering company in the EV sector, following a disappointing earnings report.

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The Global X Autonomous & Electric Vehicle ETF (DRIV) saw a decrease of 0.9% during morning trading, marking one of its lowest closes since May 4. In comparison, the S&P 500 index slipped by a mere 0.1%. Over the past three months, DRIV has registered a notable decline of 19.0%, whereas the S&P 500 has seen a more modest decrease of 5.5%.

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Tesla's stock, denoted as TSLA, experienced a substantial plummet of 7.4%, reaching a two-month low. This drop came in the aftermath of the electric vehicle giant failing to meet third-quarter earnings expectations. Moreover, Chief Executive Elon Musk tempered the anticipation surrounding the much-awaited Cybertruck. A day prior to the earnings report, Tesla's stock had already slumped by 4.8%, setting the stage for the most significant two-day decline, amounting to 11.9%, since the 13% nosedive that occurred in the two days concluding on December 27, 2022.

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Investors have expressed concerns over Tesla's potential continued lowering of prices as it seeks to balance the positive impact on vehicle sales with the negative repercussions on margins. As noted by Wedbush analyst Dan Ives, "Tesla left open the door for more price cuts ahead as Musk discussed a challenging macro environment with high interest rates that has clearly created a Rubik’s Cube backdrop for Tesla to navigate with consumers."

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Several other prominent EV manufacturers were also affected by this market turbulence. Nikola Corp. (NKLA) witnessed a decline of 6.9% as it approached a five-week low. Lucid Group Inc. (LCID) experienced a loss of 4.0%, reaching a new record low. Mullen Automotive Inc. (MULN) took a staggering hit of 23.1%, plummeting to a record low, and Rivian Automotive Inc. (RIVN) slid by 3.7%, approaching a 3 1/2-month low.

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Among Tesla's competitors based in China, Nio Inc. (NIO) saw a decrease of 2.0%, while XPeng Inc. (XPEV) recorded a 1.5% drop. Additionally, Li Auto Inc. (LI) experienced a decrease of 1.8%, with all of these companies heading towards four-month lows.

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In other areas of the EV market, Fisker Inc.'s stock (FSR) observed a decline of 2.4%. VinFast Auto Ltd. shares (VFS) were down by 4.0%, reaching a new record low, and Workhorse Group Inc.'s stock (WKHS) took a substantial 6.0% hit.

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The decline in EV stocks was primarily driven by concerns surrounding Tesla's performance, as well as broader economic factors such as high-interest rates, creating a complex landscape for electric vehicle manufacturers to navigate in the eyes of investors. This recent market activity underscores the volatility and challenges that the electric vehicle sector currently faces.

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