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Tesla Reports 12.9% Global Sales Decline in Q1 2025 as European Market Struggles Deepen

The automaker faces steep sales drops in Germany and Scandinavia, production delays for the refreshed Model Y, and intensifying competition from Chinese EV makers.

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Protesters outside a Tesla showroom in Park Royal, London
The logo of Tesla cars logo is seen during the presentation of the new charge system in the EUREF campus in Berlin, Germany September 10, 2020. REUTERS/Michele Tantussi/File Photo

Overview

  • Tesla's global vehicle deliveries fell to 336,700 units in Q1 2025, marking a 12.9% year-over-year decline and the lowest quarterly performance in three years.
  • Sales in Germany dropped 62.2% in Q1 2025, with only 4,935 units registered, as reduced government EV incentives and competition from Chinese automakers eroded market share.
  • Production delays tied to the rollout of the refreshed Model Y contributed to a 16% year-over-year decline in Tesla's Q1 production output.
  • Chinese competitors BYD and Polestar gained traction in Germany, recording significant year-over-year sales growth in Q1 2025, while Tesla's European sales varied regionally, with declines in Northern Europe but growth in Southern Europe.
  • To stimulate demand, Tesla is offering one year of free fast charging for Model Y purchases in Germany through June 2025, though its ability to meet 2025 sales targets remains uncertain.