Direxion Daily TSLA Bull 2X Shares (TSLL) plummeted 5.05% on Tuesday, reflecting investor concerns over Tesla's performance in the crucial Chinese market. The sharp decline comes as reports indicate Tesla's sales in China have fallen to their lowest level in three years.

According to data from the China Passenger Car Association (CPCA), Tesla's retail sales in China dropped to 26,006 units in October, marking a nearly 36% year-over-year decline. This represents the lowest monthly sales figure since November 2022. The slump was particularly pronounced for the Model Y, with retail sales falling to 19,488 units in October, a 46.17% decrease from the same period last year and a 61.92% drop from September.

Analysts attribute this downturn to intense competition in the Chinese electric vehicle market and weakening demand. The company's market share in China reportedly shrunk to 3.2% in October from 8.7% in September, highlighting the challenges Tesla faces in maintaining its position in the world's largest auto market. While exports from China saw an increase, with Model Y exports reaching their second-highest figure this year, it wasn't enough to offset the domestic sales decline. This development has raised concerns among investors about Tesla's growth prospects and competitive edge in a key market, leading to the significant drop in the Direxion Daily TSLA Bull 2X Shares.