Tesla bull Cathie Wood says it isn’t just Elon Musk’s politics that are causing Tesla’s ‘demand hit.’ It’s also a bad economy

• As Tesla faces backlash over its CEO Elon Musk’s personal politics, longtime investor Cathie Wood says falling sales could be part of the broader economic concerns. A series of auto industry headwinds are hitting Tesla while Musk’s political involvement stirs up widespread protests. Despite these struggles, the future of the company remains: a new, affordable EV model and the promise of perfecting self-driving cars. 

Ark Invest CEO Cathie Wood believes part of the recent “demand hit” Tesla’s taken could be because of broader fears about the economy. 

“Now, clearly the political dynamics of the last few months are hitting demand,” Wood said in a video posted to Ark Invest’s website on March 14. “We also would suggest that the economic outlook is hitting demand—not just for Tesla—but for all auto manufacturers.” 

She added it was challenging to parse out which was hurting Tesla’s sales more. 

“It'll be difficult to discern how much of the demand hit is due to a political attack and how much is economic,” Wood said. 

In recent weeks, Tesla dealerships and cars have been vandalized in various parts of the country. Earlier this month at a Tesla showroom in New York City, a peaceful protest became heated, leading to the arrests of nine people. Across the country, other people have been arrested for vandalizing Tesla locations. 

Tesla’s market share in Europe has taken a hit, as some people who disagree with Musk’s politics have stopped buying his company’s cars. In China, one of Tesla’s biggest markets, the company faces stiff competition from local rivals. Here in the U.S., drivers reportedly traded in Teslas at record rates over the last two months. 

At the same time, the broader auto industry is floundering. Nissan laid off 9,000 employees in December and Volkswagen closed factories in its native country Germany. In the U.S., the big three carmakers—Ford, GM, and Stellantis—stumbled when EV sales slowed, after they had spent billions diversifying away from gas-powered cars. Now those companies have to reckon with the Trump administration’s new blanket tariff policy, which could hit the import-heavy auto business especially hard. 

Across the broader economy, consumer confidence has been falling since the start of the year, now sitting at a yearlong low. Plus, major banks have increased their recession risks. 

Despite both Tesla’s own challenges and the possibility of an economic downturn, Wood remains extremely bullish on Tesla. In an interview with Bloomberg on Monday, Wood said she expected Tesla’s stock to reach $2,600 in five years. That would be roughly 10 times its current share price of $275.93.

Tesla and Ark Invest did not respond to Fortune's request for comment.

In Wood’s view, Tesla’s prospects hinge on releasing its new, lower-priced model and on perfecting its self-driving technology. Tesla and Musk have been touting a cheaper EV in the $25,000 range for several years. In January, Tesla told investors it should expect the model in the first half of this year. In the past, though, similar plans had been scrapped, dampening investor hopes this time around. 

However, if Tesla were to develop a truly autonomous vehicle, then it would find itself less reliant on car sales, instead turning into a software business. Much of Wood’s thesis relies on the notion that if—or in her mind when—Tesla finally launches a self-driving vehicle, it will instantly create a fleet of robotaxis from the millions of Tesla’s already on the road. 

“That same asset that already exists with no incremental cost change, just a software update, [will] now have 5 times or more the utility than they currently have,” Musk said on Tesla’s earnings call in January. 

So far, Tesla’s self-driving systems can’t yet drive entirely without human supervision. But the company has long considered it a priority. 

“Autonomous taxi networks represent the biggest AI project in the world,” Wood said. “Elon himself is focused on any bottleneck, anything that is hampering progress or slowing Tesla down.”

This story was originally featured on Fortune.com