Tesla recorded 336,681 deliveries, its worst quarterly performance in more than two years as the brand suffers a backlash to CEO Elon Musk’s political maneuverings.
The dip in sales comes as Musk continues leading DOGE, the “advisory body” that has laid off thousands of federal employees and attempted to eliminate entire agencies and programs. His involvement in the government has not only proven controversial, but also unpopular, leading many to wonder what effect it might have on Tesla’s sales.
Even one of Tesla’s top supporters on Wall Street recently beseeched Musk to spend less time on politics and more time running his businesses.
Sales were down from 495,570 in Q4 2024 and 386,810 in the first quarter of last year. Tesla also released production numbers of 362,615, which is down from previous periods in part due to the automaker switching its production lines for the new Model Y refresh, which went on sale globally in March.
“While the changeover of Model Y lines across all four of our factories led to the loss of several weeks of production in Q1, the ramp of the New Model Y continues to go well,” Tesla said in a statement.
Analysts on average expected Tesla to report deliveries of 408,000 EVs for the period of January to March, per FactSet. Though in recent weeks, several analysts downgraded their expectations to below 400,000 as “Tesla Takedown” protests erupted across the country and international sales fell.
Tesla doesn’t break down its delivery numbers by region, but sales in Europe and China have fallen in the first quarter.
In the first two months of the year, European sales tumbled 49% year-over-year, even as sales of EVs overall grew, per the European Automobile Manufacturer’s Association.
In Germany — home to one of Tesla’s gigafactories and usually one of Tesla’s largest EU markets — those numbers are down even further. In February, Tesla sales in Germany were down 76% to just 1,429 units compared to 6,038 in 2024. The fall in sales follows Musk’s endorsement of Germany’s far-right AfD party in last month’s national election.
That trend has followed throughout Europe in March, per early data released by some countries. For example, French trade association PFA reported 3,159 Tesla deliveries last month, down 37% from March 2024 and down 41% for the quarter. The story is similar in Sweden, where Tesla sales fell 64% in March.
Overall in Europe, new EV sales grew by 28.4%, capturing 15.2% of the total EU market share, even as overall new car registrations fell.
Meanwhile in China, a key market for Tesla, sales of its Shanghai-made cars fell in March amid competition from BYD, which surpassed Tesla on revenue in 2024, and other local players like Geely. Tesla sold 78,828 EVs in China in March, down 11.5% year-over-year, according to data from the China Passenger Car Association. That’s up from the 30,688 cars bought in February.
Tesla has had a rough start to the year. Its stock hit its lowest performance since 2022 amid mounting pressures, increased backlash against Musk, and an aging lineup. Despite the Cybertruck’s popularity, it hasn’t boosted Tesla’s sales numbers enough to turn things around.
Tesla likely hopes its refreshed Model Y and other potential upgrades coming this year will boost its sales numbers. Earlier this week, Tesla began offering 0% financing on the refreshed Model Y range in China. The company has also teased mysterious new lower-cost models that it has yet to reveal.
‘Darker times ahead’
Tesla bull Dan Ives, a Wedbush analyst, published a note after the numbers came out, calling on Musk to “get his act together” with respect to running DOGE and Tesla “or else unfortunately darker times are ahead for Tesla.”
“With the current headwinds for TSLA across the industry, including protests at Tesla dealerships, violence seen at TSLA drivers around the country/Europe, and more Musk-related brand worries, this delivery number was a disaster for the bulls with continuous negativity around the TSLA brand. We are not going to look at these numbers with rose colored glasses … they were a disaster on every metric.”
Still, Wedbush maintained its Outperform rating for Tesla due to a continued faith in the automaker’s potential to break into the autonomous driving market, despite the fact that Tesla has not yet achieved full self-driving. Tesla aims to launch a robotaxi service in Austin this summer, which will be a pivotal moment in deciding whether Tesla will finally live up to its CEO’s many promises.
This article has been updated to include a reaction from Wall Street.
