Tesla Sales Fall Sharply In Q2 Amid Stiff Competition And Backlash Over CEO Elon Musk's Political Activities

(MENAFN- Live Mint) Tesla faced another tough quarter, reporting a significant 13.5% drop in global car sales compared to last year. This marks the company's largest-ever yearly decline, with deliveries falling to roughly 384,000 vehicles, nearly 60,000 fewer than last year. Surprisingly, Tesla's stock price climbed about 4% following the news, according to a CNN report.

Stock rises despite historic drop as results beat grim forecasts

Why the positive reaction? Investors were relieved because many analysts had predicted an even steeper fall than what was seen in the report. This suggests the market was bracing for worse results, making the reported dip, while substantial, seem like a relative win for the electric car giant facing mounting challenges.
The sales slump isn't happening in a vacuum. Tesla CEO Elon Musk's increasingly vocal political stances, particularly his initial alignment with former President Trump, sparked widespread protests at Tesla showrooms across the US and Europe.

Protests and Chinese rivals erode market share globally

Reports also mention incidents of vandalism targeting Tesla vehicles and facilities, directly hurting the brand's image. While Tesla doesn't split sales by region, vehicle registration data strongly indicates sharp declines in these key Western markets. Beyond the political fallout, Tesla faces intense pressure from growing competition in the electric vehicle sector, not just from traditional automakers like Volkswagen and Ford, but crucially, from Chinese rivals like BYD, which is becoming a stiff competition, on the course to overtaking global EV sales.
Chinese automaker BYD has emerged as Tesla's most formidable competitor, recently overtaking it as the world's top seller of pure EVs.

Also Read | Microsoft to cut over 9,000 jobs as part of streamlining workforce efforts

Despite not selling in the US, BYD reported selling a massive 1 million pure EVs in just the first half of this year. This beats Tesla's roughly 721,000 deliveries during the same period. This competition is particularly fierce in China, the world's largest EV market and Tesla's second-biggest after the US, where local brands like BYD are gaining significant ground in recent months. While Tesla's Q2 sales did show a 14.1% improvement, the yearly decline and BYD's surge signal a major shift in the global electric vehicle landscape.

MENAFN02072025007365015876ID1109753863