New York: Tesla has officially lost its position as the world’s bestselling electric vehicle manufacturer, as intensifying competition from China’s BYD and growing consumer backlash against CEO Elon Musk’s right-wing political stance have pulled down its global sales for the second consecutive year.
Tesla reported deliveries of 1.64 million vehicles in 2025, marking a 9% decline compared to the previous year. In sharp contrast, Chinese EV giant BYD surged ahead, selling 2.26 million vehicles, making it the new global leader in the electric vehicle market.
In the fourth quarter, Tesla delivered 418,227 vehicles, missing analysts’ expectations of around 440,000. A major contributing factor to the weaker performance was the expiration of the $7,500 US federal EV tax credit, which was phased out by the Trump administration in late September and dented demand.
Despite the slump, Tesla’s stock remained largely stable, trading at $450.27 in early Friday trading. Interestingly, investors still appear optimistic, betting heavily on Elon Musk’s future vision. Tesla shares ended 2025 up by about 11%, reflecting continued belief in Musk’s ambitious long-term strategy.
Musk has repeatedly emphasized that sliding vehicle sales are not the biggest concern anymore. Instead, he is pivoting Tesla’s future toward autonomous robotaxi services, humanoid robots for homes and factories, and expanding Tesla’s energy storage division. This confidence was further cemented when Tesla’s board approved a massive new compensation package for Musk, which shareholders backed in November.
Tesla also introduced lower-priced versions of the Model Y and Model 3 in the last quarter of the year, with the new Model Y priced just under $40,000 and the Model 3 under $37,000. These models are aimed at boosting competitiveness against Chinese manufacturers, especially in Asia and Europe.
Financially, analysts expect Tesla’s fourth-quarter results, due in late January, to reflect a 3% drop in revenue and a nearly 40% drop in earnings per share. However, many forecast a gradual recovery as 2026 progresses.
Meanwhile, Elon Musk received another major personal win recently, after the Delaware Supreme Court reinstated his previously nullified $55 billion pay package from 2018, further cementing his status as the world’s richest man.
The report clarifies that BYD sold 2.26 million vehicles last year — not 2.26, correcting an earlier typographical error.