Tesla conveys 61,662 electric vehicles from Giga Shanghai in May, marking a 15% decrease compared to the same period last year.
Tesla, the world-renowned electric vehicle (EV) manufacturer, has experienced a drop in sales in key markets such as China, Europe, and Canada. This downturn can be attributed to a combination of factors, including model updates, economic and policy uncertainties, competitive pressures, and brand perception issues.
In China, Tesla's sales have shown a declining trend in the first half of 2025. This is particularly evident in the Model Y, with a 24% drop in registrations from January to May. The slowdown is believed to be due to anticipation of an imminent model update, causing a temporary softening of demand ahead of the release of the refreshed version. However, June 2025 sales showed signs of recovery, with a 0.8% increase year-over-year and a 16.1% rise compared to May, suggesting that the downward trend may be ending and production at the Shanghai plant is stabilizing.
Europe has also seen a significant drop in Tesla sales. In May 2025, sales across 30 European countries fell by 28%, and overall deliveries decreased by 13% in Q2 2025 compared to the previous year. This decline is partially linked to economic uncertainty from tariffs and proposed changes to EV incentives, including the possible phase-out of a $7,500 U.S. federal tax credit. Additionally, Tesla faced protests at showrooms related to Elon Musk’s political activism, which may have negatively influenced consumer sentiment.
Canada's sales figures for Tesla are not detailed, but the company's overall North American EV sales growth slowed significantly in H1 2025 compared to robust growth in China and Europe. This suggests regional challenges such as incentive reductions and market saturation. Used Tesla vehicles have also suffered notable price drops, which suggests weakening demand and resale value potentially affecting new vehicle sales dynamics in North America, including Canada.
Despite these challenges, Tesla's May sales showed a modest 5.5% improvement from April's sales of 58,459 units. However, May 2025 was still Tesla's second-worst month in the past two years, with only February 2024 having lower sales.
Tesla's struggles are not limited to China and Europe; the company has faced similar challenges in Canada. The Canadian government's decision to exclude Tesla from the iZEV rebate program is a potential additional challenge to Tesla's sales in Canada. This decision is related to political backlash from Elon Musk's association with U.S. President Donald Trump.
It is important to note that the Canadian government's iZEV rebate program is intended to support electric vehicle sales. Tesla's May sales are a wholesale figure, including both domestic sales and exports. In May, Tesla delivered 61,662 Model 3 and Model Y units from Giga Shanghai. Both the Model 3 and Model Y were added to China's rural EV promotion program this week.
Recent data from China signals a possible stabilization or rebound at least in that crucial market moving forward. The challenges facing Tesla are complex and multifaceted, but the company remains a leader in the EV industry and is well-positioned to navigate these challenges and continue its growth trajectory.
[1] "Tesla China Sales in June 2025 Show Signs of Recovery." Electrek, 1 July 2025, [2] "Tesla Europe Sales Drop in May 2025." Electrek, 5 June 2025, [3] "Tesla's North American Sales Growth Slows in H1 2025." Electrek, 15 July 2025, [4] "Used Tesla Vehicles Depreciate in North America." Electrek, 20 July 2025,
- The decline in Tesla's sales in China, Europe, and Canada can be attributed to a variety of factors, including model updates, economic and policy uncertainties, competitive pressures, and brand perception issues.
- In the automotive industry, technology plays a crucial role in the development and production of electric vehicles (EVs), such as those manufactured by Tesla.
- The Canadian government's decision to exclude Tesla from the iZEV rebate program is a potential additional challenge to Tesla's sales in Canada, which could impact the company's business and lifestyle in the region.
- As the electric-vehicle industry continues to evolve, companies like Tesla will have to navigate complex challenges and adapt to changing financial landscapes and transportation policies in various markets, including China, Europe, and North America.
