Tesla lost its position as the world’s largest electric vehicle maker in 2025 after a year of slowing sales, allowing China’s BYD to take the lead. Tesla delivered 418,227 vehicles in the final quarter, bringing its full year total to around 1.64 million EVs, a decline of more than 8 percent compared with 2024. Analysts had expected stronger fourth quarter performance, with forecasts closer to 449,000 deliveries.
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In contrast, BYD reported 2.26 million EV sales in 2025, comfortably surpassing Tesla and reinforcing China’s growing dominance in the global electric vehicle market. Market pressure on Tesla increased after the 7,500 dollar US EV tax credit ended in September 2025, a move that industry experts say disrupted demand and will take time to stabilize.
Tesla also faced challenges in key markets, particularly Europe and China, while political controversies involving CEO Elon Musk added to investor concerns. As a result, Tesla shares closed 2.6 percent lower in New York following the sales update.
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Analysts at Wedbush Securities noted that while Tesla’s results were not as weak as some feared, the company is operating in a tougher demand environment. Regulatory delays around self driving approvals in Europe remain another hurdle, though sales growth in smaller and emerging markets has begun to offset some declines in larger regions.
Despite losing the global EV crown, Tesla remains a major player, with analysts suggesting a potential rebound once regulatory and market pressures ease.