For the first time since 2011, Tesla has experienced a sales decline, with figures showing a 1.1% drop in 2024. This downturn has been attributed to increased competition, particularly from Chinese automaker BYD, and potential pushback from consumers due to CEO Elon Musk’s political ties.
Tesla’s sales fell to 1.79 million vehicles in 2024, a slight decline from the 1.81 million units sold in 2023. While the company had offered attractive incentives, including 0% financing, free charging, and low-priced leases, these promotions only resulted in a modest 2.3% increase in sales during the final quarter, bringing the total number of vehicles sold from October to December to 495,570.
The drop in sales came as competition intensified, especially from BYD, which saw a 41% increase in its own sales, reaching 1.77 million units last year. Tesla’s smaller and more affordable models, such as the Model 3 and Model Y, made up most of its sales, while high-end models like the Model X, S, and the new Cybertruck saw less demand, with only 23,640 units sold.
Another factor affecting Tesla’s performance may be Musk’s public support of Donald Trump in the US presidential race. His political affiliations could alienate environmentally conscious buyers who typically favor Democratic candidates. This, coupled with the aging lineup of Tesla’s vehicles, appears to have put a dent in the company’s growth.
Following the sales announcement, Tesla’s stock dropped by 6.1%, after having previously surged by 50% in the wake of Trump’s election victory. Despite the sales decline, some analysts, like Daniel Ives from Wedbush, continue to view Tesla not just as an automaker, but as a disruptive force in the technology sector, particularly with its ambitions toward fully self-driving cars.
