New York (CNN Business) Tesla was once the darling of Wall Street. Not anymore.

The automaker's stock has plunged nearly 40% since the start of 2019, erasing most of the gains it made over the past several years. This week,shares fell below the $200 mark for the first time since 2016.

The outlook isn't nearly as bright for a company that once was had faster sales growth than any other auto company in the industry's history.

But Tesla recently posted its biggest drop in sales ever. It's getting squeezed by rivals in the electric car market who are all competing for customers. And the company has been forced to close stores and raise prices as it struggles to return to profitability.

To top it off, Tesla is expected to burn through a huge amount of cash in the coming year and it prepares for an international expansion that poses challenges of its own, along with the creation of a vehicle that could be its most important yet, the lower-cost Model Y SUV — all while preparing for looming debt payments.

"The clouds are getting darker for Musk & Co.," wrote Daniel Ives at Wedbush Securities in a research note published Monday. "We continue to have major concerns around the trajectory of Tesla's growth prospects."

The problem with demand

One of the drivers of the latest stock slump is how Tesla is handling the softening demand for its cars. The company's auto sales slowed significantly at the start of the year.

The tax credit that Tesla offered to buyers was cut in half, contributing to the slowdown. The loss of a big chunk of that $7,500 federal tax credit — which lowered the amount people had to pay for Tesla's vehicles — makes Tesla a tougher sell for budget-conscious buyers.

The other part of the problem is that Tesla has satisfied much of the demand from fans who were willing put down a $1,000 deposit, and then wait months, if not years, for their cars to be built. The wait time for a Model 3 is now less than two weeks.

That puts Tesla in an unfamiliar position: It needs to find buyers for its cars. It was used to having more demand than it could satisfy.

Demand is at the heart of the problem." Adam Jonas, Morgan Stanley analyst

Another sticking point: Although the company has become the leading luxury car brand in the United States, it has found Musk's promise of bringing cars to the masses difficult to fulfill. The Model 3 was supposed to fill that role. But Tesla has made buying the budget version of the Model 3 harder, and the much-touted $35,000 sticker price has been creeping higher.

General Motors GM Tesla also isn't selling in a vacuum. For much of its history, Tesla didn't have much competition in the electric vehicle market aside fromand Nissan, which manufactured such cars for a couple of years.

But now Honda, Hyundai, Kia, Volkswagen, BMW and Jaguar all offer purely electric vehicles for sale in the United States. Other luxury brands such Audi, Porsche and Mercedes are getting close as well. So even with growing demand for electric cars, Tesla is facing a much more competitive landscape.

"Demand is at the heart of the problem," wrote Morgan Stanley auto analyst Adam Jonas in a research note Tuesday. "Tesla has grown too big relative to near-term demand, putting great strain on the fundamentals."

Jonas' note rippled through Wall Street. He's a fan of the company: his price target is $230, 12% above what the stock is trading at now. But he's worried about its basic cost structure in the face of softening demand.

His worst-case scenario is that Tesla's stock could plunge as low as $10 per share, a 95% wipeout, if its efforts to increase Chinese sales fall well short of its goal. His previous worst-case figure was $97 a share.

Ives, the Wedbush analyst, cast doubt on Tesla's chance of returning to profitability. The company snapped a brief profit streak last quarter when it reported that it lost $702 million.

Ives said Tesla and Musk need to cut expenses much faster if they want to make it back to the black. He described the company's profit targets this year as a "Kilimanjarao-like uphill climb," and suggested the company could sell tens of thousands of cars less than its 360,000 to 400,000 target for the Model 3.

Burning cash

Even Musk has talked about the need to cut expenses.

"I think it is healthy to be on a Spartan diet for a while," he said about the company's cost structure during a recent analyst call discussing the company's first quarter loss.

The company had to repay $920 million in debt during the first quarter. That, combined with the expansion of the Model 3 to overseas markets, led it to end the quarter with $1.5 billion less in cash on hand. That's why Tesla ended up needing to raise cash through a stock-and-debt sale earlier this month. But its long-term bonds have lost value, along with its stock price, since those offerings.

And Tesla has huge demands on its cash ahead.

It said it expects to spend $2 billion to $2.5 billion this year alone on three major projects — building its first factory in China, and developing the Model Y and a semi truck — as well as further expanding its supercharger network and vehicle service operations to satisfy customers.

It plans to begin production of the Model Y next year, but first it will have to construct a factory at which to build it. There isn't enough capacity at its existing Fremont, California, plant to build the crucial SUV.

Tesla will need to return to profitability sooner rather than later or concerns about another cash crunch will start to weigh on its stock. The company has $1.4 billion billion in debt coming due in March 2021, and another $977 million a year later.

Despite those concerns, Tesla still has fans among its investors.

When it sold the stock and bonds to raise the cash earlier this month, it even found more demand than it expected, allowing it to raise an extra $400 million

And Musk, the company's largest shareholder, demonstrated his faith in the stock by purchasing an additional $25 million worth of shares from the recent offering with his own money. He also purchased another 175,000 shares, worth just under $35 million, through the exercise of options this week.

But the outlook for those shares is nowhere near as bright as it once was.