Elon Musk’s Worldwide Tesla Sales Plummeting Beyond Expectations

Tesla’s European sales plummeted by nearly 45% and worldwide by more than 50% in February, resulting in a market share of just 8.4%, the lowest in five years. Meanwhile, Chinese rival BYD has overtaken Tesla in global revenue, clocking more than $100B in 2024.

Tesla in Cross hairs:

Chinese EV brands sold nearly 20,000 vehicles in Europe last month, compared to Tesla’s 15,700 units.

Analysts attribute this downturn to CEO Elon Musk’s political involvement with Donald Trump and anti-labor sentiment, which has led to consumer backlash.

Additionally, delays in updates to the Model 3 and Model Y may have caused potential buyers to delay purchases, further impacting sales. ​

Increased Competition:

The electric vehicle (EV) market is becoming increasingly competitive, with established automakers and new entrants, particularly from China, introducing compelling EV models.

Chinese Competitor Growth:

Competing companies are creating vehicles that are sold for much lower prices than tesla, and are also creating very high quality vehicles. This is creating a large amount of competition for Tesla. BYD’s aggressive pricing strategy and technological advancements are putting significant pressure on Tesla. BYD is one of Tesla’s biggest Chinese rivals. It recently took a lead in EV revenues and reported $107B in 2024 — a 29% increase from the previous year.

Aging Product Lineup:

Some analysts suggest that Tesla’s product lineup is aging, and the company needs to introduce new models to maintain its competitive edge. While the Model 3 and Model Y have seen updates, the core design has remained relatively consistent.

Elon Musk’s Public Persona:

Elon Musk’s political statements and actions have generated controversy, leading to backlash and potential boycotts in some regions. His endorsements of certain political figures and parties have alienated some consumers.

The Gaza Effect

Elon Musk’s Israel visits and his censoring of X (Erstwhile Twitter) by restricting Pro Palestinian accounts while promoting Israeli propaganda and siding with the genocide in Gaza has largely contributed to people shunning Tesla worldwide.

Regional Economic Factors:

Changes in government subsidies and economic conditions in certain regions can also impact EV sales. For example, changes to subsidy programs in Germany have impacted EV sales there.

Why it matters:

Tesla is feeling the heat from European and Chinese competitors, who are quickly closing the gap in terms of price, features, and overall availability. BYD, despite the newly imposed EU tariffs, is pushing its strategy of low-priced EVs and plug-ins, with sales projections pointing toward rapid growth this year.

In essence, Tesla is facing a confluence of challenges, including heightened competition, evolving consumer preferences, and the impact of its CEO’s pro zionist public image.