The stock market has had its fair share of down days recently, but April 2 was not one of them -- the S&P 500 ended that session essentially flat. However, shares of Tesla (TSLA +0.63%) plunged by more than 5% on the day after the company announced a disappointing set of electric vehicle (EV) delivery numbers for the first quarter. And then they kept falling. Tesla is coming off two consecutive years of declining passenger EV sales, and another decline in 2026 looks possible. Many investors own its stock because they are enthusiastic about future products like the Cybercab autonomous robotaxi and the Optimus humanoid robot, but 73% of the company's revenue still comes from selling passenger cars. On that note, sluggish EV sales have led to poor financial results, which could drive its stock sharply lower from here. Pulling back from passenger EVs The company delivered 1.79 million EVs in 2024, which was down 1% from the prior year. The decline worsened in 2025, with deliveries sinking by 9% to 1.63 million cars. As a result, the company's automotive revenue sank by 10% last year, with its earnings per share (EPS) plummeting 47%. Tesla delivered 358,023 EVs during the first quarter of 2026, which was actually a 6% increase from the prior-year quarter. However, it was well below Wall Street's consensus estimate of around 370,000 -- hence the sharp decline in the stock on April 2, and in the sessions that followed. As of midday on April 7, the shares were down by more than 10% from where they closed April 1. Management said it manufactured over 408,000 cars during the first quarter, suggesting that its inventories may have grown. That could place downward pressure on prices (and profit margins) in the current quarter. Rising competition has been a