Amid growing fallout from Elon Musk’s controversial role in the Trump administration, Tesla’s sales experienced a staggering 13 percent decline in the first quarter of 2025 compared to the previous year.
The company reported a total production of 362,615 vehicles in the first three months of the year, which includes 345,454 Model 3 and Model Y vehicles, along with 17,161 “other vehicles” such as the Model S, Model X, and Cybertruck. In terms of deliveries, Tesla delivered 336,681 vehicles, comprising 323,800 Model 3 and Model Y units and 12,881 other vehicles—a 12.9 percent decrease from Q1 2024. For a direct-to-consumer company like Tesla, deliveries serve as a proxy for sales.
This report marks Tesla’s worst performance in production and deliveries over the past three years. Analysts had anticipated that Tesla would report deliveries of 377,592 vehicles in this quarter, a drop from 386,810 vehicles a year earlier, according to estimates from 27 analysts compiled by Tesla. Compared to Q1 2023’s performance of 422,875 deliveries, the recent figures reflect a significant decline of over 20 percent.
It was Tesla’s worst production and delivery report in three years
Tesla explained that the decline in deliveries was impacted by the production transition for the refreshed Model Y, which has just begun reaching customers. However, the issues Tesla faces extend far beyond this single factor.
This report follows weeks of concerning indicators for the electric automaker. Tesla’s stock has decreased nearly 36 percent since the start of the year, marking the third-largest drop in the company’s 15 years of public trading. This decline has erased approximately $460 billion from the company’s market capitalization and reduced Elon Musk’s net worth by over $100 billion.
Additional troubling signs emerged ahead of the Q1 report. Sales in Europe dropped nearly 43 percent year over year in January and February, based on registration data from the EU. In China, sales lagged for much of the quarter until the final week, when vehicle insurance registrations surged. (Tesla does not disclose regional sales figures, making Europe and China registration data closely monitored.)
While Tesla encounters new challenges, other automakers are witnessing robust sales of their electric vehicles. For instance, General Motors reported nearly 32,000 EVs sold in the first quarter, roughly doubling its year-over-year figure.
Tesla’s difficulties are partly attributed to Musk’s involvement with the Department of Government Efficiency, or DOGE, a controversial initiative aimed at eliminating “waste and fraud” in the government that appears primarily focused on dismantling humanitarian aid programs and intimidating federal employees. Musk has also promoted racist theories on social media and made a fascist salute during Trump’s inauguration.
These actions have sparked a nationwide protest movement called Tesla Takedown, which aims to boycott the company and drive down its stock price. This movement seems to be successfully persuading many progressive Tesla owners to sell their vehicles, despite significant declines in used car values.
Moreover, there have been unrelated incidents of violent attacks on Tesla stores and vehicles globally, including arson and vandalism. A fire at a showroom in Rome resulted in the destruction of 17 cars. President Donald Trump has stated that individuals caught vandalizing Tesla vehicles would face charges of “domestic terrorism.”
Musk is now pinning his hopes on AI, robotics, and self-driving technologies, which he argues will elevate Tesla to new financial heights. He has announced plans for an “unsupervised” robotaxi pilot in Austin, Texas, slated for June. However, his previous promises regarding autonomous driving have often been unfulfilled, leading experts to question Tesla’s approach to this technology, especially in light of numerous fatal crashes involving the company’s partially automated features.
Additionally, Musk has indicated that the company plans to introduce a new, lower-cost model later this year, although no details about this vehicle have yet been disclosed.
