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Tesla's Annual Car Sales Slip for First Time as EV Competition Grows
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By The New York Times
Published 4 months ago on
January 2, 2025

Tesla sales fell slightly in 2024, the first annual decline in the company’s history. (AP File)

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Tesla sales fell slightly in 2024, the first annual decline in the company’s history, as rivals in China, Europe and the United States introduced dozens of competing electric models, giving buyers more choice.

Jack Ewing

New York Times

The company said Thursday that it delivered 1,789,226 vehicles worldwide during the year, a slight decline from 1,808,581 in 2023. During the last three months of 2024, Tesla delivered 495,570 vehicles, up from 484,507 in the last quarter of 2023.

The fourth-quarter deliveries were the best ever for Tesla, according to the company, but were not enough to make up for sluggish sales earlier in the year.

Tesla shares, which have been buoyant in recent months, were down about 5% in midday trading Thursday.

Tesla and its CEO, Elon Musk, largely created the market for electric vehicles when it began selling the Model 3 sedan in 2017, arguably the first battery-powered car with the price, performance and range to attract large numbers of mainstream buyers. Tesla still accounts for nearly half of all electric cars sold in the United States.

Competitors Challenge Tesla’s Dominance

But carmakers like BYD in China, General Motors, Kia-Hyundai, Volkswagen, and BMW have challenged Tesla’s dominance, often with models that have newer designs and lower prices.

BYD, which has nearly caught up to Tesla as the world leader in sales of purely battery-powered cars, sold 1.76 million electric vehicles in 2024, the company said Wednesday, an increase from 1.6 million the year before. Unlike Tesla, BYD also sells plug-in hybrids that use gasoline and electricity, which have become popular in China. Last year, the company sold 2.49 million hybrids, a huge jump from 1.44 million in 2023.

Wall Street analysts had expected Tesla to report a slight increase, at best, in car sales for the year. During the first nine months of the year, Tesla sales fell in the United States, Europe and China, according to industry data and analyst estimates. Tesla sales declined even as overall sales of electric vehicles in the first 11 months of the year rose 25% globally, according to Rho Motion, a research firm.

But investors have been largely indifferent to the sales figures, focusing instead on Tesla’s efforts to develop cars that can drive themselves without human intervention and on other products like humanoid robots that are not likely to generate revenue for many years.

Tesla Battery Sales Soar

Tesla also sells batteries used to store renewable energy at homes and businesses. Sales of those products soared 60% from the third quarter, Tesla said, enough to store 11 gigawatt hours of energy. Tesla began reporting sales of battery storage products this year.

Tesla shares have risen steeply since early November as investors bet that President-elect Donald Trump will remove regulatory obstacles to self-driving cars, which Musk has described as central to Tesla’s future. Musk spent more than $250 million to help elect Trump and has become one of his most important advisers.

Tesla is “not making nearly enough money to justify the share price,” said Leonard Kostovetsky, an associate professor at the Zicklin School of Business at Baruch College. “People are justifying it based on things that will happen in the future.”

Investors also do not seem to be concerned that Musk’s vocal support of Trump and right-wing leaders in other countries has alienated potential Tesla buyers, who tend to be people who lean left politically.

Trump Vows to End Incentives

Trump has promised to dismantle federal programs that benefit Tesla, including subsidies for battery manufacturing in the United States and a $7,500 tax credit for electric-car buyers. Musk has said that removal of the incentives will hurt competitors more than it does Tesla.

Analysts expect sales of Teslas and other electric models to spike in the coming months as buyers in the United States rush to take advantage of the incentives before they disappear.

Tesla has promised to begin selling a car in 2025 for as little as $25,000, expanding the number of people who could afford an electric vehicle. But the company has not displayed a prototype, and Musk has provided few details about the product.

This article originally appeared in The New York Times.

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