Tesla Sales Declined For The First Time In A Decade

Tesla posted its first annual sales decline in over a dozen years.

The company’s global sales fell to 1.79 million vehicles in 2024, a 1.1% drop from the 1.81 million sold in 2023, despite a late-year push driven by discounts, free charging incentives, and low-priced leases.

Tesla’s fourth-quarter sales rose 2.3% year-over-year to 495,570 vehicles, aided by aggressive promotional efforts. However, the Associated Press reports the average sales price for Tesla's vehicles dropped to just over $41,000, the lowest in four years, signaling pressure on the company’s industry-leading profit margins.

Tesla’s lineup, dominated by the Models 3 and Y, is starting to show its age in the entry-level luxury market. The Model Y, Tesla’s newest consumer vehicle, launched in 2020. Meanwhile, the recently introduced Cybertruck has seen limited uptake and has been plagued by recalls.

Tesla faces stiff competition globally, particularly from Chinese automaker BYD, which reported a 41% surge in sales to 1.77 million EVs in 2024, narrowly trailing Tesla’s 1.79 million units.

Elon Musk’s vocal support for President-elect Donald Trump may also be alienating Tesla’s left-leaning buyer base.

To meet its long-term goal of 20% to 30% annual sales growth, Tesla will need to address these headwinds with strategic product updates and market diversification. Fourth-quarter production reached 459,445 vehicles, slightly below deliveries, while full-year production totaled 1.77 million units.

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