Tesla deliveries drop 13% in Q1 2025 as market share, subsidies, and production decline

Tesla’s vehicle deliveries dropped to 336,681 in the first quarter of 2025, down 13% from the same period a year earlier.

The figures, released on Tuesday, reflect weaker-than-expected sales, missed investor targets, and mounting competitive pressures across global markets.

Tesla’s share price fell 4% after the results, adding to a 36% decline over the past quarter—the company’s steepest since late 2022.

Production also fell to 362,615 vehicles, down from 433,371 a year ago.

This dip comes as Tesla navigates production pauses, increased EV competition, subsidy shifts, and political controversies involving CEO Elon Musk, who is now also a key figure in President Donald Trump’s administration.

Tesla missed Q1 delivery targets

Investors had expected Tesla to report between 360,000 and 370,000 deliveries for Q1 2025, while company-supplied estimates averaged around 377,590.

Prediction platform Kalshi had forecast 352,000. However, actual deliveries came in below all these figures.

Of the 336,681 vehicles delivered, 323,800 were Model 3 and Model Y units—Tesla’s most popular models.

The remainder, 12,881 units, came from the company’s other models, including the Cybertruck.

Tesla noted that some production declines were due to planned shutdowns for manufacturing upgrades, particularly for the Model Y.

CEO Musk has said he expects the Model Y to be “the best-selling car on Earth again this year,” but the Q1 numbers indicate challenges ahead.

Tesla’s Europe market share drops

Tesla’s performance in Europe has notably weakened. In the first quarter of 2025, its market share across 15 European countries fell to 9.3%, down from 17.9% in the same period of 2024, according to EU-EVs.com.

Germany saw one of the steepest drops, with Tesla’s battery electric vehicle share shrinking to just 4% from 16% a year earlier.

The decline follows a broader pullback in Tesla’s European business amid rising competition and political backlash.

In February, Elon Musk endorsed Germany’s anti-immigration AfD party ahead of the elections, sparking protests and boycotts that extended to Tesla showrooms and charging sites.

Musk’s politics affecting Tesla?

Musk’s political involvement is playing an increasingly visible role in Tesla’s public perception and business environment.

After spending $290 million to support Trump’s return to the White House, Musk was appointed to lead the newly created Department of Government Efficiency (DOGE).

The agency has undertaken cost-cutting reforms and regulatory rollbacks, including eliminating thousands of federal jobs.

Back in North America, Tesla-owned dealerships in Canada claimed to have sold 8,653 vehicles during one weekend in January.

The timing enabled Tesla to qualify for CAD 43 million ($31.56 million) in subsidies before the program expired.

The move raised questions among regulators and competitors, though it remains within legal bounds.

Tesla China sales fall further

Tesla’s China sales also weakened. According to data released Wednesday by the China Passenger Car Association, the company sold 78,828 electric vehicles in March—down 11.5% year-on-year.

Tesla is increasingly losing ground to local competitors such as BYD, who have grown both in market share and in consumer appeal.

The Asia-Pacific region remains a crucial pillar of Tesla’s growth strategy, but ongoing price wars and shifting consumer preferences in China have made the road tougher for foreign EV manufacturers.

Tesla’s total stock decline in Q1 2025 now stands at 36%, wiping out $460 billion in market capitalization.

This marks the third-largest quarterly drop since the company went public 15 years ago.

The post Tesla deliveries drop 13% in Q1 2025 as market share, subsidies, and production decline appeared first on Invezz