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Tesla’s US registrations fell a whooping 16% in April as the country’s electric vehicle (EV) registrations fell for the first time in 14 months. For Tesla, though, the sales woes have deepened in 2025 after it reported its first-ever annual shipment decline last year.
The sales decline continued in Q1 2025, with Tesla producing 362,000 vehicles and delivering 332,000 of them. For context, the US electric vehicle (EV) giant delivered 386,810 vehicles in the corresponding quarter last year. Its Q1 shipments were in fact the lowest in almost three years.
Tesla’s Sales Have Been Weak
The numbers don’t come as a surprise, as there were signs that Tesla’s sales were weak in the US. In May, the company cut the financing rates for its new Model Y in the US. While it is usual for the company to offer incentives towards the end of the quarter, this time around, it offered the discount just about a month into the quarter, and that too on the latest version of its best-selling vehicle.
Tesla said that it is offering “1.99% APR or $0 Due at Signing available for well-qualified buyers,” which implies a discount of a few thousand dollars on the model. Notably, Model Y is the best-selling vehicle globally, not only in the EV space but across all vehicle types. The company launched its long-awaited refreshed version of the aging model earlier this year, but the discounts suggested that the demand for the model is perhaps not as strong.
Tesla’s Global Sales Have Also Been Falling
While Tesla would officially release its Q2 production and delivery numbers only early next month, data from Europe and China shows a worsening slowdown. The company’s sales from the China Gigafactory have fallen in the first two months of this quarter. The factory produces cars for the domestic Chinese market and also exports to parts of Europe.
There is a fierce price war in the Chinese EV market as companies have been cutting prices and offering incentives to spur sales. The Chinese auto market is among the most competitive globally, and domestic players are increasingly taking market share from foreign brands like Volkswagen and Ford. The price war only escalated after BYD cut prices on many of its models, especially those in the budget range.
Tesla’s sales in Europe fell by over 50% in May, even as it saw an increase in sales in some markets like Norway. Musk’s embrace of right-wing politicians seems to have alienated many potential Tesla car buyers, which is reflected in its falling sales in Europe, where it is fast losing ground to Chinese automakers as well as European auto giants like Volkswagen.
In April, BYD surpassed Tesla in battery electric vehicle (BEV) registrations in Europe for the first time. It is yet another milestone for the Chinese giant after having dwarfed Tesla’s global deliveries in 2022. Last year, BYD surpassed Tesla in terms of total revenues, also.
BYD Is Selling More BEVs Than TSLA in Europe
“Although the difference between the two brands’ monthly sales totals may be small, the implications are enormous. This is a watershed moment for Europe’s car market, particularly when you consider that Tesla has led the European BEV market for years, while BYD only officially began operations beyond Norway and the Netherlands in late 2022,” said Felipe Munoz, Global Analyst at JATO Dynamics, commenting on BYD surpassing Tesla.
In Q1 2025, BYD sold over 1 million cars, and its BEV sales were ahead of Tesla despite the first quarter being seasonally weak in China due to the Lunar New Year Holidays.
Looking at the strong growth in the first five months of the year, BYD looks set to become the world’s biggest seller of BEVs in 2025 and hit yet another milestone.
Notably, in 2011, Tesla CEO Elon Musk laughed at the possibility of BYD becoming a competitor to Tesla. However, the Chinese company has proven critics wrong and has emerged as a serious competitor to Tesla, not only in China but also in global markets.
Tesla’s Stock Has Rebounded from the Lows
Tesla’s stock price has meanwhile rebounded sharply this year and even rose after what was a dismal Q1 2025 earnings report, where it missed on both the topline and the bottomline. Many were perplexed at the price action post the Q1 report, which was so blatantly detached from the earnings report. The only positive trigger was CEO Elon Musk announcing that he would step back from the Department of Government Efficiency (DOGE) to spend more time at Tesla.
Musk has since not only left the White House but has also been involved in a bitter feud with the President. While the billionaire has expressed regret over some of his tweets targeting Trump, many believe the relations between the two might never be the same again.
As for Tesla’s price action, a MarketWatch article best sums up the anomaly. It says, “Given Musk’s ability to use social media to drive Tesla stock significantly higher without traditional fundamental justification (some call this “pumping”) you have buyside (institutional) investors reluctant to step in and attempt to make markets efficient by shorting the stock. As a result, there is a strong argument that we don’t have proper “price discovery” for Tesla shares.”
Robotaxi Launch Is Tentatively Set for June
Musk has set June 22 as the tentative date for the company’s ambitious robotaxi launch in Austin. The launch is, however, facing protests in Austin over safety concerns. On Thursday, the demonstrators showed how a Tesla with its full self-driving (FSD) software zoomed past a school bus that had a stop sign held. The car also ran over a child-sized mannequin that the demonstrators had put in front of the vehicle.
Notably, the FSD is far from perfect, and US regulators are investigating several cases of crashes involving the software.
