Tesla stock (TSLA) has seen a dramatic drop this year, losing almost 70 percent through December 22 year to date.

This means TSLA is on pace for a record annual decline that will see it erase about $626 billion of shareholder value, according to Bloomberg. A year ago, Tesla shares reached a record high, pushing the company's valuation to more than $1 trillion for the first time. 

Now investors are struggling to see a bottom, though, with Tesla shares closing at $125.35 on December 22, compared to an all-time high of $409.97 on November 5, 2021—technically $1,229.91 as Tesla performed a 3-for-1 stock split since.

December 2022 is on track to become the worst month ever for Tesla stock, which has tumbled 36 percent so far this month. By comparison, Tesla's shares dropped 22 percent in March 2020, when the coronavirus pandemic hit, sending financial markets into a slide.

As competition from established major automakers is intensifying, Tesla's dominant market share is threatened, and the stock price reflects that to an extent.

Gallery: Tesla Cybertruck

Bloomberg quotes analysts as saying that the EV startup's highly anticipated driving software and its battery technology are falling short of their timelines, while the futuristic design of the Cybertruck can make it a tough sell as a mainstream vehicle.

While tech shares have suffered broadly as the Federal Reserve hiked interest rates to curb inflation, sparking fears of a possible recession, Tesla shares have been among the weakest amid fears that demand for expensive EVs will drop.

To make matters worse, Elon Musk's $44 billion purchase of Twitter fueled concern that he was reducing its focus on Tesla. The fact he sold Tesla shares worth almost $40 billion to help finance the deal clearly didn't help either.

Several days ago, Musk confirmed he would step down as CEO of Twitter, but didn't provide a timeline. His comments did not lead to a major rally in Tesla's shares.

Despite the stock's massive drop from a year ago, Tesla remains the most valuable automaker in the world, with a market cap of almost $396 billion on December 22. That's far bigger than any other major global carmaker, with Toyota—the second-biggest—valued at about half that.

Got a tip for us? Email: tips@insideevs.com