Tesla sales have plummeted 13 per cent as the firm bears the financial brunt of Elon Musk‘s fervent posting on X and growing competition in China from homegrown brands.
The world’s richest man and self-declared Tesla ‘Technoking’ has attracted widespread international condemnation for his social media activity and actions such as an alleged Nazi salute at Donald Trump‘s inauguration – a claim he denies.
His actions have sparked a recent wave of anti-Tesla protests and vandalism targeting vehicles made by the company, which include the Model 3 saloon, Model X SUV and the controversial Cybertruck.
Today Tesla said it had delivered 336,681 vehicles in the three months to the end of March – its weakest sales performance since the second quarter of 2022.
Tesla said it produced 362,615 vehicles in total over the quarter. Its share price dropped two per cent on Wednesday, continuing a run of weakness that has cost the company around 45 per cent of its value since December.
The latest sales figure was also significantly below the roughly 390,000 figure predicted by industry analysts.
Musk is reportedly preparing to step back from the US Government’s Department of Government Efficiency (DOGE) as of today following the news – prompting an uptick in the firm’s share price.
There were warning signs of an imminent sales dip. Tesla slashed the prices of its cars, offered cheap financing and tried to bring in buyers with other incentives such as two years of free charging with Tesla’s own Supercharger units.
Tesla sales have dipped amid competition from cheaper Chinese brands and a global backlash against Elon Musk (pictured: a protest in London)
Speculation of an imminent dip in sales intensified after US President Donald Trump held what appeared to be an impromptu Tesla sales event at the White House
Tesla vehicles have been the subject of vandalism and alleged destruction (pictured: a Tesla Cybertruck that caught fire in Seattle, the cause of which remains under investigation)
Speculation of a drop in trading intensified after US President Donald Trump turned the White House lawn into a temporary Tesla sales showroom last month.
Trump went viral as he appeared to read from a crib sheet about the cars alongside Musk and Musk’s son X Æ A-12, before proclaiming: ‘I’m president, so I want to pay full price.’
As he climbed into the electric car and surveyed the largely minimalist interior, dominated by a large touch screen, he sagely noted: ‘Wow… everything’s computer.’
Some Tesla owners have traded in their vehicles, no longer wanting to be associated with Musk.
The fall is likely due to a number of factors, including Musk’s posting with impunity on X about matters on immigration, gender and the government – in which he has become Donald Trump’s ‘First Buddy’.
The firm is facing heavy competition from other car manufacturers who are now investing heavily in electric vehicles – particularly in China.
But Tesla has also been hit by its own work at factories to make its redesigned Model Y mini-crossover.
In a statement, the Texas-based company said: ‘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.
‘Thank you to all our customers, employees, suppliers, shareholders and supporters who helped us achieve these results.’
Musk has faced widespread international criticism over his political views and gestures – including an alleged Nazi salute at Donald Trump’s inauguration (pictured)
Tesla vehicles have been the target of vandalism that appears to be directed at Elon Musk following the alleged far-right gesture
Tesla infrastructure such as its Supercharger car charger network has been targeted by firebugs
Others have staged protests outside Tesla dealerships across the world (Pictured: a protest in Germany earlier this week)
Tesla said sales were hit due to logistical problems associated with the manufacture of its revamped Model Y crossover (pictured)
Figures from the China Passenger Car Association (CPCA) earlier this week showed that Tesla sales in the company have dropped by around 11.5% year-on-year.
Many buyers in China, as well as in the likes of the UK, are now considering buying Chinese electric cars made by firms such as BYD, Geely and Chery.
Matt Britzman, senior equity analyst at Hargreaves Lansdown, said: ‘There’s no way to sugarcoat it, Tesla’s first-quarter delivery numbers are a disappointment, though many investors were already preparing for a soft number.
‘A drop from last year is no surprise, but the scale is worse than many had expected.’
Wedbush’s Dan Ives, a prominent technology analyst who has been a longtime believer in Tesla’s growth potential, called the figures ‘a disaster on every metric,’ according to a note seen by AFP.
‘It’s a fork in the road moment,’ said Ives, who has called for Musk to publicly outline how he is balancing his Tesla commitments with his work for Trump.
‘The more political he gets… the more the brand suffers, there is no debate. This quarter was an example of the damage Musk is causing Tesla,’ he added.
Sales of the firm’s cars are likely to take a further hit with the imposition of 25 per cent car import tariffs in the US. Other countries are likely to lay out tariffs of their own on American imports, pushing up Tesla prices.
The firm – of which Musk became a later ‘co-founder’ following a settlement, despite not joining until nearly a year after its formation – is also hedging its bets on battery technology and robotics, pushing ahead with development of its Optimus robots.
Tesla dealerships have been picketed by protesters in recent weeks and its vehicles and infrastructure targeted by vandals and firebugs.
Many of the materials distributed by protesters highlight the alleged far-right gesture made by Musk during the inauguration, in which he said: ‘My heart goes out to you.’
Musk has denied that the salute was Nazi in nature, calling criticism of it ‘dirty tricks’ by the media.
However, those who have then used the gesture in apparent solidarity have found themselves in trouble, including commentator turned alleged man of the cloth Calvin Robinson, who was dropped by the Anglican Catholic Church after performing it.
Ahead of the drop in deliveries being disclosed, Musk tweeted to claim Tesla’s Model Y was the best-selling car in China and Norway in March.
By manufacturer, BYD was the best-selling car maker in China last month, selling 371,419 cars, according to the CPCA, followed by Geely which sold 119,696.
Tesla sold 78,828 cars in the same time period, according to the figures.