- First-quarter Tesla deliveries fell to levels not seen in nearly three years. The company has seen sales declines throughout Europe and China in recent months.
- The company is facing stiff competition from other domestic brands and newcomers abroad.
- The first quarter is generally the worst time of the year for car sales, and Tesla is best positioned to avoid President Donald Trump’s auto industry tariffs.
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Tesla announced its worst quarter for deliveries in more than two years as the company’s CEO has been making waves in Washington. The company said it delivered 336,681 vehicles in the first quarter of 2025, missing Wall Street expectations, which already projected a decline.
Deliveries fell 13% from 2024
Tesla’s deliveries were down 13% from the 386,800 in the first quarter of 2024. It marks the lowest number of deliveries since the second quarter of 2022, when the company delivered 254,700 cars.
The data on deliveries, released on Wednesday, April 1, is the first release since Tesla CEO Elon Musk took a central role in the Trump administration. The world’s richest person leads the Department of Government Efficiency (DOGE), which is tasked with reducing the size of government.
“You instantly think, ‘It’s all the people out there protesting,’” auto industry analyst Lauren Fix told Straight Arrow News. “That’s a small piece of the pie.”
“We knew they were going to be down, not just here in North America, but also in China and in Europe,” Fix added. “In a country like China, people tend to purchase their own brands, which is like BYD [and] SAIC. They’re reconsolidating the Chinese market right now, but they’re very strong. BYD being the No. 1 leader in the world, and they’re coming out with really creative product. They’ve got very fast charging that’s substantially faster than what Tesla offers.”
Tesla facing stiff competition at home and overseas
Tesla sales in China were down 11.5% year-over-year in March. Meanwhile, sales in European markets have fallen significantly.
“Looking at the U.S. side alone, you’re looking at some fantastic product being put out by Hyundai and Kia,” Fix said of EV competition in the U.S. “Ford’s got the [Mustang] Mach E, General Motors has a lot of new luxury vehicles. So, if the competition increases, obviously your sales are going to drop down, but the sales have dropped down for a lot of different reasons.”
Tesla notched its first annual sales drop in a decade in 2024 as global electric vehicle sales surged 25% for the year, setting a new record.
Fix says hybrid vehicles are taking a large chunk out of the electric market. She also points out that the first quarter is a notoriously slow period for auto sales. Some of Tesla’s factories were shut down early this year to retool for a revamp of its Model Y.
“The first quarter is always slow for auto sales,” Fix told SAN. “You were waiting on your bill for the IRS. That’s a big factor. Plus, coming off the holiday season, all those bills that have to be paid. Typically, it’s slow. You’ll see things pick up in the spring. This is where you’re also going to see the bank rates lowering down a little bit in the spring to try and entice people to make purchases. You’re also going to start seeing a lot of incentives coming, but they typically don’t come until the second quarter.”
The Elon Musk of it all
Sentiment around Tesla is souring as Musk becomes more involved in politics. In a YouGov/Yahoo News poll taken at the end of March, two-thirds of respondents said they would not consider buying or leasing a Tesla. More than a third of total respondents said Musk was at least part of the reason. Overall, 55% of respondents said they had an unfavorable opinion of Musk.
“I think it is overblown,” Fix said of the negative sentiment surrounding Musk. “I think as far as the mainstream media, they’re kind of looking for a story to hang their hat on. I think when you look at Tesla as a whole, [Tesla’s] more than just a car company. [Tesla’s] an electronics company. [Tesla’s] a tech company. We’ve got robots coming.”
As President Donald Trump rolls out a slew of tariffs since taking office, Tesla is one of the better-positioned automakers, assembling all of their U.S.-sold vehicles in the U.S.
