According to Reuters, Tesla’s second-quarter deliveries (scheduled to be announced on July 3) are expected to decline again, dragged down by negative reactions and continued competitive pressures caused by its CEO Elon Musk’s political views and continued competitive pressures.
New Model Y; Image credit: Tesla
Although Tesla’s trillion-dollar valuation relies heavily on Musk’s bets on commercializing self-driving taxis, most of the company’s current revenue and profits still come from its core business -Electric vehicleSale. However, its electric vehicle business is under pressure due to high interest rates and increasing competition.
Although the growth rate of the global electric vehicle market has slowed down compared to previous years, it is still growing. However, in 2024, Tesla’s annual sales will decline for the first time, partly due to Tesla’s older product line. Although Musk claims that Tesla’s sales will return to growth in 2025 (a statement that has retracted his earlier commitment to increase by 20% to 30%), analysts expect Tesla sales to still decline by 8% year-on-year this year.
According to a survey of 23 analysts by Visible Alpha, Tesla is expected to deliver 394,380 vehicles in the second quarter of this year. It fell more than 11% year-on-year, while the company’s deliveries fell 13% year-on-year in the first quarter of this year.
However, Tesla has said that its sales decline in the first quarter of this year was due to the suspension of production in favor of an updated version of the best-selling Model Y SUV. At the same time, analysts have also pointed out that many customers have postponed their purchases by waiting for the launch of new cars.
Ross Gerber, CEO of Gerber Kawasaki Wealth & Investment Management (Tesla investor), said: “I think many analysts expect Tesla’s sales to pick up in the second quarter of this year due to the new Model Y. But in my opinion, the new Model Y is not much different from the old one. He added that demand for Tesla’s new Model Y did not meet expectations.
Previous data shows that Tesla’s sales did not increase but fell. Some intended clients are deeply dissatisfied with Musk’s public support for far-right politics in Europe and his leadership of federal government positions and budget cuts during his tenure as President Donald Trump.
According to data from the European Automobile Manufacturers Association, although Musk has shifted his focus back to his companies, Tesla’s sales in Europe fell 27.9% year-on-year in May due to the wave of boycotts and consumers switching to more affordable Chinese electric vehicles, falling for the fifth consecutive month.
In the Chinese market, Tesla’s share of electric vehicles has fallen from a peak of 15% in 2020 to 10% in 2024 to 7.6% in the first five months of 2025. Competitors have won the favor of consumers with stylish and feature-rich new models, such as the Xiaomi SU7 has been on the market for several hours with an unusually hot number of orders, which has led to speculation that Tesla may be forced to cut prices.
Sam Fiorani, vice president of research firm AutoForecast Solutions, pointed out: “Tesla’s sales performance in the European market lags behind the overall electric vehicle industry, coupled with the increasingly fierce competition in the Chinese market, these two headwinds will continue to constrain its future development. ”
Wall Street analysts believe that if Tesla’s sales estimates for the second quarter of this year are accurate, then in order to achieve Musk’s goal of resuming Tesla’s sales growth this year, Tesla needs to deliver a record more than 1 million vehicles in the second half of this year; Although sales are usually stronger in the second half of the year, there are still serious challenges to achieving this goal.
Tesla’s lower-priced model, which was originally scheduled to go into production at the end of June, is expected to be a simplified Model Y, may bring a turnaround to the company, but Reuters reported in April that the model would be delayed by at least a few months.
Although Tesla’s stock price fell sharply earlier this year due to fierce anti-Musk protests, it has recently partially recovered. In June, the company launched about 12 self-driving taxis in a limited area of Austin, Texas, USA, carrying invited users for a nominal fee, but with safety officers and other restrictions.
