Tesla's Deliveries in China Reach a Three-Year Low, Forecasting First Annual Decline in 2025
Following a robust third quarter marked by record electric vehicle sales, Tesla Inc. (NASDAQ:TSLA) is encountering an unexpected setback in the initial phase of the fourth quarter. Recent reports highlight a notable reduction in the company's vehicle sales within the Chinese market, a pivotal region for the automaker.
Details on Tesla's Sales Performance
In October, Tesla's sales in China amounted to approximately 26,000 units, representing a substantial 36% decrease compared to the previous year. This figure not only marks the lowest monthly sales for Tesla in China during 2025 but also signifies the worst performance for the company in this market over the past three years. This decline surpasses even the period when Tesla was undergoing the transition to the updated Model Y production, as detailed by Electrek.
As of now, Tesla's cumulative deliveries in China for 2025 are roughly 40,000 vehicles fewer than the previous year. To avert its first year-over-year annual sales decline in China, the electric vehicle titan would need to achieve unprecedented sales figures in both November and December. China currently stands as Tesla's second-largest market, following the United States.
This downturn follows a strong third quarter and September, during which the company recorded 71,525 deliveries in China. Data further indicates that Tesla's total deliveries in China for October, encompassing exports, reached 61,497 vehicles, a 9.9% year-over-year reduction. The Gigafactory in China is responsible for producing vehicles destined for export to various countries, including India.
Moreover, similar challenges are emerging for Tesla in the European market. Preliminary registration data for October revealed a 36.3% year-over-year drop across nine key European nations. Five of these countries experienced declines of 50% or more, with only France showing an increase, potentially due to governmental incentives aimed at encouraging electric vehicle purchases among low- and middle-income individuals. In total, approximately 4,710 units were registered in October across these nine European countries. Year-to-date, Tesla registrations in Europe have fallen by over 30%, from 255,000 units last year to around 177,000 units this year.
After achieving record sales in the third quarter both globally and in the U.S. market, Tesla appears to be heading into a challenging fourth quarter. The expiration of the Federal EV tax credit on September 30 in the U.S. may lead consumers to postpone electric vehicle purchases until new incentives become available or prices decrease. In both Europe and China, Tesla is facing intensified competition from local automakers, who are offering more affordably priced electric vehicles.
Consequently, Tesla's stock experienced a 1.9% decline, trading at $436.82 on Tuesday. This contrasts with its 52-week trading range of $214.25 to $488.54, despite a 15.2% year-to-date increase in 2025.
This recent development serves as a crucial reminder of the dynamic and fiercely competitive nature of the global electric vehicle market. While Tesla has consistently demonstrated innovation and market leadership, these figures underscore the necessity for continuous adaptation and strategic adjustments in response to regional market shifts, evolving consumer behaviors, and increasing competition. For investors and industry observers, these trends highlight the importance of monitoring not just overall growth, but also the nuanced performance across diverse geographical segments, as they collectively shape the future trajectory of leading EV manufacturers.