- China was the only major market where Tesla saw growth this year as sales of its EVs fell pretty much everywhere else.
- Tesla was likely banking on higher Cybertruck sales this year, but the angular, stainless-steel electric pickup just isn't living up to expectations.
- If this trend continues, BYD will likely overtake Tesla in 2025 and become the world's biggest seller of electric vehicles.
Tesla just experienced its first annual sales decline in over a decade, signaling a significant shift on the global EV scene in 2024. The only major market where it experienced growth last year was China, even though the trend among Chinese EV buyers was to move away from foreign brands and buy locally made models instead.
Reuters notes that Tesla’s 2024 sales in the People’s Republic went up 8.8% compared to 2023, rising to 657,000 units delivered. With 36.7% of its global deliveries, China is Tesla’s second-largest market after the United States, where sales fell compared to 2023, when nearly 675,000 vehicles were delivered. U.S. sales didn’t drop enough to put China in the number-one spot, but the difference was likely much lower than in 2023.
2024 is also the year when China asserted its dominance as the world’s biggest EV player, with a slew of very talented domestic models that also saw success outside the local market. BYD, in particular, had an excellent year and delivered 4.25 million passenger vehicles. It also narrowed the gap with Tesla, delivering 1.76 million EVs (an increase of 12.1% over 2023) to Tesla’s 1.8 million (a decrease of 1.1% over 2023).
Lower subsidies in Europe combined with an influx of talented Chinese and Korean EVs saw Tesla’s sales on the continent fall by 13.7% in the first 11 months of 2024. We don’t have any exact end-of-year figures from Europe, but it’s likely well below 2023, when Tesla delivered around 364,000 vehicles, marking a 57% increase over 2022.
Increased competition played a big part in why Tesla stopped seeing growth this year. On home ground in the U.S., General Motors rose to become the country’s second-best-selling EV manufacturer thanks to an impressive sales performance, especially in the latter part of the year—GM sold almost 44,000 EVs from October through December, marking a 125% increase over Q3 2023. It amounted to 114,000 EVs sold in the U.S. in 2024.
Tesla was probably also banking on the Cybertruck to sell better in North America, which it seemed to be doing in its first months of sale, but then things started looking less rosy for the stainless steel electric pickup as the year drew on. Toward the end of 2024, it became apparent that Cybertrucks weren't as popular as it initially appeared, and even used examples weren't finding buyers.
If the trend continues, China could overtake the U.S. as its main market this year. Analyst John Zeng, who is the head of Chinese market forecasts at GlobalData, called China “the only major market seeing robust growth versus a slowdown or even slide in other markets.” The fact is a more significant proportion of Chinese car buyers are willing to go electric, while in the U.S., buyers are going back to non-plug-in hybrids, which saw a big resurgence in 2024.
What could reverse the trend for Tesla would be the release of the highly anticipated affordable model, which is rumored to arrive sometime around the middle of the year and cost less than $30,000 with the $7,500 federal tax credit included. There is an acute lack of affordable EVs in the U.S., which partly explains why EVs are so much more popular in China, where you can get a fully-fledged electric car like the BYD Dolphin for less than $14,000—it costs twice that outside China.
Chinese automakers have announced their strong interest in entering the U.S. market and selling vehicles here, but they were forced to put their plans on hold after a 100% import tariff was imposed. Had this tariff not been put in place, there would have been several Chinese automakers already present and selling cars in the U.S., further diminishing Tesla’s EV market share, which fell to 48% in 2024 even without them here.
