Tesla Reports Record Sales Plunge From Last Year

Tesla’s image as the world’s leading EV pioneer took another hit this week as it reported a dramatic sales decline.

On Wednesday, Tesla revealed it sold 384,122 vehicles in the second quarter, down 13.5% (or nearly 60,000 cars) compared to the same period last year. Despite this decline, the number reflects a 14.1% increase from the previous quarter, offering a small silver lining. Interestingly, Tesla shares (TSLA) opened up nearly 4% following the report—not because of great performance, but because the results weren’t as bad as some analysts had feared.

This decline marks Tesla’s largest annual drop in sales ever, and its second consecutive quarter of double-digit decline. These back-to-back setbacks come after Tesla’s first-ever annual sales drop in 2024, breaking a long streak of yearly growth.

A major factor driving this slide is Elon Musk’s polarizing political presence, especially his involvement in the Trump administration. His alignment with the controversial president has triggered widespread protests at Tesla showrooms across the U.S. and Europe, and in some cases, vandalism of Tesla vehicles and facilities. Although the company doesn’t release regional sales data, registration numbers suggest steep declines in both U.S. and European markets despite overall EV sales in those regions rising.

“Musk can’t seem to put down the political megaphone, even if it hurts Tesla,” one related report observed.

Compounding the issue is mounting pressure from rivals. Tesla now faces fierce competition not just from established Western automakers expanding their EV portfolios, but also from Chinese giants like BYD, which are quickly grabbing global market share. Tesla’s struggles in China—its second-largest market—have been exacerbated by this surge in domestic competition.

Earlier on Wednesday, BYD announced it had sold 1 million electric vehicles in just the first half of 2025, far ahead of Tesla’s 721,000 year-to-date. This puts Tesla on track to lose its crown as the world’s top EV maker for the first time, even though BYD still hasn’t entered the U.S. market.

Tesla’s volatile stock performance over the past year reflects this rollercoaster narrative. Following the 2024 U.S. election, Tesla shares nearly doubled by mid-December, driven by investor optimism over Musk’s ties to the new Trump administration. But that momentum quickly reversed. By mid-April, the stock had plummeted over 50%, wiping out all prior gains.

However, the recovery has slowly begun. The tide started to turn when Musk announced his exit from the Trump administration in April to focus on Tesla full-time. Enthusiasm returned with news of Tesla’s upcoming robotaxi service, a long-promised innovation. Together, these announcements helped the stock rebound 35% from its April lows through Tuesday’s close.