A sharp drop in Tesla’s sales during the first three months of the year indicates that Elon Musk’s electric car company, once a darling of investors, is now facing difficulties in attracting buyers. This decline of 13% may be attributed to several factors, including an outdated product lineup, increased competition, and a backlash due to Musk’s embrace of right-wing politics. This drop is a troubling sign for Tesla’s upcoming earnings report, which could disappoint investors.

Tesla delivered 336,681 vehicles globally in the January-March quarter, a figure significantly lower than the 408,000 vehicles that analysts had predicted. This marks a decrease from the 387,000 vehicles sold in the same period last year, despite significant discounts, zero financing options, and other incentives.

Additionally, Tesla faces growing competition from rivals as their electric vehicle offerings improve. Notably, BYD, a leading Chinese electric vehicle manufacturer, recently introduced a technology that enables its cars to charge within minutes. This advancement could further erode Tesla’s market share, especially as consumers wait for the updated version of Tesla’s best-selling Model Y, slated to be released later this year.

Tesla’s stock price has tumbled by nearly half since it hit a record high in mid-December, as initial optimism about lighter regulatory oversight and high profits under the Trump administration gave way to concerns over the boycott of Musk’s cars and other challenges facing the company. Analytics are yet to determine the exact contribution of the protests to the decline in sales, but the overall landscape for electric car sales remains sluggish, with buyers hesitating over Tesla products, particularly in anticipation of new models.

Source: https://www.theguardian.com/technology/2025/apr/02/tesla-sales-down-elon-musk