Tesla reported fourth-quarter 2025 vehicle production and deliveries on Friday, confirming a second consecutive annual decline for the automaker as competition intensified and policy changes disrupted demand. The company said total deliveries for the year fell 8.6% compared with 2024, while its shares closed down 2.59% on the day.
Tesla said it delivered 418,227 vehicles in the fourth quarter and produced 434,358 vehicles during the period. For the full year, total deliveries reached 1.64 million vehicles, while production totaled 1.65 million. Wall Street had expected about 426,000 deliveries in the quarter, according to estimates compiled by StreetAccount. In a consensus posted on Tesla’s website on Dec. 29, the company said analysts it surveyed anticipated deliveries of 422,850 vehicles, representing a 15% decline from a year earlier.
Fourth-quarter deliveries were about 16% lower than in the same period of 2024, when Tesla reported 495,570 deliveries. Production in the fourth quarter declined 5.5% year over year from 459,445 vehicles. For the full year, deliveries fell from 1.79 million vehicles in 2024 to 1.64 million in 2025.
Tesla said deliveries of its Model 3 sedan and Model Y SUV totaled 406,585 units in the fourth quarter, accounting for about 97% of all vehicles delivered. Deliveries of the Model S, Model X, and Cybertruck combined reached 11,642 units during the quarter.
After unveiling the Cybertruck, Tesla said it received more than 1 million reservations for the vehicle, though the angular electric pickup has yet to become a major sales contributor. Musk’s aerospace and defense company, SpaceX, reportedly purchased tens of millions of dollars’ worth of Cybertrucks in 2025.
Tesla continues to face mounting competition from global automakers, including China’s BYD, South Korea’s Kia and Hyundai, and Volkswagen in Europe. BYD said in a statement Thursday that its sales rose 28% to 2.26 million vehicles, allowing it to surpass Tesla as the world’s largest EV seller on a calendar-year basis.
Deliveries remain Tesla’s closest proxy for sales, though the company does not precisely define the metric in its shareholder disclosures.
Beyond vehicles, Tesla reported deploying 14.2 gigawatt hours of battery energy storage products in the fourth quarter, following a prior-quarter record of 12.5 GWh. The company’s energy products include home backup batteries as well as large-scale systems used by utilities and data centers.
Tesla said it will report its fourth-quarter financial results on Jan. 28.
Vehicle sales were affected by President Donald Trump’s decision to end a federal EV incentive earlier than expected, with the program expiring on Sept. 30. The policy change pulled some demand into the third quarter for Tesla and other automakers.
Tesla’s challenges began earlier in 2025. After spending heavily to support Trump’s return to the White House, Elon Musk spent much of the first quarter leading the administration’s DOGE initiative aimed at reducing the federal workforce. Musk also endorsed Germany’s anti-immigrant AfD party, supported British activist Tommy Robinson, and called for the abolition of the European Union.
Tesla has faced sustained consumer backlash in Europe and the United States partly in response to Musk’s political statements. The company has not fully recovered, despite launching a more affordable version of its Model Y SUV in October.
Even so, Tesla shares rallied in the second half of the year, rising about 40% in the third quarter and reaching a record high in mid-December. Musk purchased $1 billion worth of Tesla shares in September. In November, shareholders approved a new $1 trillion compensation plan that would grant Musk additional shares and greater control of the company, following his warning that he could step away if the plan failed. Critics raised concerns that the package does not require minimum time commitments to Tesla or restrict political activity.
While Tesla does not disclose deliveries by region, data from the European Automobile Manufacturers’ Association showed the company lost market share in Europe in 2025. Tesla’s registrations in the region fell 39% in the first 11 months of the year, while BYD’s registrations increased 240%. Battery electric vehicles accounted for about 16% of all new vehicle sales in Europe during that period.
Some analysts expect Tesla’s lower-priced Model Y Standard, introduced in October, to support sales recovery in future quarters. In a note published last week, analysts at Cannacord Genuity said EV adoption is increasing rapidly in emerging markets such as Thailand, Vietnam, and Brazil, which could provide longer-term opportunities for Tesla despite strong competition from Chinese manufacturers including Xiaomi and Geely.
Tesla continues to emphasize Musk’s long-term vision of what he describes as sustainable abundance. That strategy extends beyond vehicle sales to include autonomous robotaxis and humanoid robots, which Musk has said could one day operate factories and perform a wide range of tasks.
Featured image credits: Wikimedia Commons
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