Tesla annual sales decline 9% as it’s overtaken by BYD as global EV leader

Tesla’s global vehicle deliveries declined by 9% in 2025, falling to 1.63 million units from 1.79 million in 2024, marking the second consecutive year of sales decline. The drop was driven primarily by the removal of the $7,500 U.S. federal tax credit and intensifying competition from Chinese automakers, particularly BYD, which surpassed Tesla as the world’s leading electric vehicle (EV) seller. Tesla’s fourth-quarter sales fell sharply by 15.6% year-over-year to 418,227 vehicles, significantly below analyst expectations, causing Tesla’s stock to drop over 2% after the New Year holiday. The decline is also linked to Tesla losing market share in Europe and China, while facing growing competition in the U.S., although Chinese EVs remain barred from the American market. Despite CEO Elon Musk’s strategic shift toward AI, robotics, and a broader vision of “sustainable abundance” encompassing energy generation, battery storage, and