Tesla sales fell by 9 percent in 2025, its second yearly decline

Tesla has released its final production and delivery figures, revealing a challenging year for the electric vehicle giant. In the last quarter of 2025, sales plummeted by nearly 16%, equating to a staggering drop of 77,343 electric vehicles compared to the same period in 2024. Looking at the annual performance, the decline appears slightly less severe, with an overall decrease of 8.6% year-on-year. This means Tesla sold a total of 1,636,129 vehicles in 2025, which is 153,097 units fewer than in 2024. Interestingly, this figure still surpasses the sales from 2023. Several factors have contributed to this downturn. Tesla's heavy reliance on the Models 3 and Y has become a significant issue, as both models have received only minor updates, making them feel outdated when compared to newer offerings from European and Asian competitors. Additionally, the much-anticipated Cybertruck has turned out to be a major disappointment. Initially projected to launch in 2021 at a price below $40,000, the vehicle's production has faced numerous setbacks, overshadowing other company initiatives. One such initiative, Tesla's in-house battery cell, was originally tailored for the Cybertruck but has now seen diminished demand. Recent reports indicated a drastic reduction in value for Tesla's $2.9 billion contract with South Korean battery material supplier L&F, which was marked down to just $7,386—a staggering decrease of over 99%. Moreover, CEO Elon Musk's controversial political stance may be affecting sales, particularly in regions like California and Europe, where environmentally conscious consumers are increasingly selective about their purchases.