That's what analysts are asking after looking at the electric car company's latest sales data.
Tesla sold about 1,600 of its Model S sports sedans in the U.S. in March, just slightly more than it sold in the same month a year earlier, according to AutoData Corp. Through the first three months of this year, the Palo Alto car company has sold 4,700 cars in the U.S., up not quite 1% from the same period a year earlier.
"We believe that Model S demand in the U.S. has plateaued," said Brian Johnson, an analyst with Barclays Capital.
Johnson said U.S. sales of the Model S, which starts at about $71,000, peaked in the second quarter of last year.
“To a large extent, the early adopters have gotten their fix,” said Thilo Koslowski, an analyst with
But it will be hard to expand sales volume because, Koslowski said, "The price point is still pretty high for a typical consumer to embrace the car."
Tesla needs to bring out its so-called Generation 3 electric car -- a vehicle expected to sell for less than $40,000 when it hits the market in several years. But the timing is so far off that Tesla may see more competition from traditional automakers selling alternative fuel vehicles before the car finally hits the market, Koslowski said.
Tesla's problem is that excitement about the brand is starting to wane, said Jeremy Acevedo, an analyst at car shopping company Edmunds.com.
That could change, he said, when Tesla introduces its new Model X sport-utility vehicle, scheduled to go on sale in 2015.
Acevedo said the Model X should rejuvenate the brand and its sales, and should appeal to a whole new demographic -- affluent women.
For now, that leaves international markets for the prime source of Tesla growth. But the international markets might not be so great either, Johnson said.
Outside of Norway, European sales are "seemingly soft." There is also the potential for a decline in Norway if electric vehicle incentives there are not renewed, he added.
"Tesla will be dependent on strong Chinese demand," Johnson said. "While we expect strong initial interest from early adopters in China, we see challenges to broader luxury market adoption."
These trends may be weighing on the price of Tesla's stock. Tesla's shares have declined about 15% since hitting a high of $254.84 on March 4. It was at $215.04 in mid-day trading Tuesday, up $7.52 or 3.6%.
The electric car company is working to broaden its market in the U.S. On Tuesday, Tesla announced a lease plan for small- and medium-sized businesses. The Tesla business lease will be offered through Tesla Finance, a subsidiary the automaker has set up to offer cars to business customers.
Leasing is a common tool for business customers, attorneys and real estate agents, especially for luxury cars, Koslowski said.
"That will be used by businesses that can write off some portion of the lease from their taxes," he said.