- Tesla (TSLA) stock dropped nearly 20 points in premarket trading Tuesday after China-made EV sales fell 49% year-over-year to 30,688 units in February, with global sales of 93,926 units in the first two months of 2025 down 28.7%.
- Local Chinese rivals outperformed Tesla, with BYD selling 322,846 NEVs (up 164% year-over-year), Li Auto delivering 26,263 vehicles (up 29.7%), and Nio moving 13,192 units (up 62.2%), intensifying competition in the region.
- Tesla’s struggles extend beyond China, with sales in France declining 26% and Scandinavian registrations dropping 42% to 48% in February, despite the launch of the Model Y Juniper to bolster its market position.
Tesla (TSLA) is facing mounting pressure as its stock – down 34% year-to-date – slid $18.70, or 6.57%, to $265.96 in premarket trading on Tuesday, reflecting a steep decline in its China-made electric vehicle (EV) sales. Data from the China Passenger Car Association (CPCA) paints a stark picture: Tesla sold just 30,688 EVs in February, a 49% drop year-over-year and its lowest monthly figure since August 2022. This slump follows a broader trend, with global sales of China-made vehicles – comprising the Model 3 and Model Y – reaching 93,926 units in the first two months of 2025, down 28.7% from the same period last year. The monthly drop was even more pronounced, with February deliveries plummeting 51.5% from January, signaling a rapid erosion of Tesla’s foothold in the world’s largest EV market.
The competitive landscape in China has shifted dramatically, with local players capitalizing on Tesla’s struggles. BYD (BYDDF), a dominant force in the new energy vehicle (NEV) sector, reported 322,846 sales in February, a staggering 164% increase year-over-year and a 7.42% uptick from January’s 300,538 units. Li Auto (LI) delivered 26,263 vehicles, up 29.7% from the prior year, while Nio (NIO) moved 13,192 units, reflecting a 62.2% year-over-year gain despite a 4.8% dip from January. These figures highlight the intensifying rivalry Tesla faces, particularly in China’s electric mid-size SUV segment, where the newly launched Model Y Juniper aims to reclaim ground. Tesla touts the refreshed model as a strong contender, but its ability to replicate the pre-facelift version’s success remains unproven amid this fierce competition.
Beyond China, Tesla’s challenges are reverberating globally. In Europe, the company’s sales are faltering, with France reporting a 26% year-over-year decline in February. Scandinavia, a historically strong market for Tesla, has seen even sharper drops, with registrations falling between 42% and 48% across Sweden, Norway, and Denmark. These declines underscore broader headwinds, from softening demand to heightened competition, that are testing Tesla’s dominance in the EV space. The company’s global sales of 93,926 China-made vehicles in January and February reflect not just regional difficulties but also the strain of maintaining market share as rivals scale up production and innovation.
Tesla’s introduction of the Model Y Juniper in China offers a glimmer of hope, targeting a segment where it has historically excelled. Yet, the 30,688 units sold in February – down 49% from last year – suggest that even product refreshes may struggle to counter the momentum of competitors like BYD, whose 322,846 NEV sales dwarf Tesla’s output. The company’s 51.5% month-over-month drop from January further exposes vulnerabilities in its pricing strategy and production capacity, areas where Chinese rivals have gained an edge. In Europe, the 26% sales tumble in France and the 42% to 48% registration declines in Scandinavian markets signal that Tesla’s woes are not isolated, potentially pressuring its valuation as investors reassess its growth trajectory.
The EV giant’s current predicament reflects a pivotal moment in its evolution. While Tesla sold 93,926 China-made vehicles globally in the first two months of 2025, the 28.7% year-over-year decline highlights the scale of the challenge ahead. Local competitors like Li Auto, with 26,263 deliveries, and Nio, with 13,192, are narrowing the gap, leveraging government support and cost advantages in China. Meanwhile, BYD’s 164% growth to 322,846 units underscores how swiftly the market is tilting toward homegrown brands. As Tesla grapples with a 49% sales drop in China and a 26% decline in France, its ability to adapt – whether through the Model Y Juniper or broader strategic shifts – will determine if it can weather this storm and reclaim its position as the EV pacesetter.
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