Is Musk to Blame As Tesla Sales Crash?

Tesla’s global sales have experienced a significant downturn at the start of 2025, with various factors contributing to this decline, including increasing concerns about CEO Elon Musk’s polarizing politics, according to analysts. Despite the introduction of the Cybertruck, which was anticipated to attract a broader customer base in the U.S. pickup truck market, the company is witnessing notable decreases in key regions both in Europe and its biggest market in the U.S.

Germany

In Germany, Tesla’s sales plummeted by 59% in January compared to the same time period the previous year, totaling just 1,277 registrations in the country. This sharp decline comes despite Tesla’s previous stronghold in the German EV sector, even amidst increasing competition from local manufacturers like Volkswagen, BMW, and Audi, as well as emerging Chinese brands.

France

Similarly, France reported a 63% decrease in Tesla sales in January compared to the same period the previous year, indicating challenges in maintaining market share in another significant European market.

California

The California New Car Dealers Association reported that while electric vehicle (EV) sales remained steady at 25.3% of new car sales in the state, Tesla’s registrations dropped by 11.6% in 2024. This decline equates to nearly 30,000 fewer Model 3 registrations compared to 2023, and the Model Y saw a reduction of over 4,000 units. The Cybertruck, although becoming California’s top-selling electric truck, registered only 9,019 units, a modest figure in such a prominent EV market.

Several factors may be influencing these downward trends, including reduced EV subsidies, intensifying competition from both established and new automakers, and potential impacts from public perceptions of Musk’s actions and statements.

THE TAKEAWAY

Tesla sales have dropped like a rock and there are reasons to wonder if this is the beginning of a longer-term trend or a short-term blip. As Tesla navigates these challenges, the upcoming global release of the new Model Y in March is anticipated to play a crucial role in the company’s strategy to regain its market position.

Sources: EV Car Answers Editors, ChatGPT, Tesla