The global electric vehicle race saw a major shift in 2025 as Tesla fell short of expectations in the final months of the year and lost its top spot to China based BYD.
Tesla reported weaker than expected deliveries for the fourth quarter of 2025. The company delivered 418227 vehicles between October and December which took its total sales for the year to around 1.64 million electric vehicles. Market expectations were higher with analysts projecting quarterly deliveries of 449000 based on a FactSet consensus.
A day earlier BYD announced that it sold 2.26 million electric vehicles in 2025. This performance helped the Shenzhen based automaker overtake Tesla in annual global EV sales. BYD also manufactures hybrid vehicles and said its electric vehicle sales touched a record high during the year.
Industry observers say electric vehicle demand in the United States is still adjusting after the 7500 US tax credit ended in September 2025. They believe it could take time before the market reaches a stable demand level. However, Tesla had already been facing pressure even before the incentive was withdrawn.
The company has seen slower sales in several key markets amid rising competition from BYD other Chinese manufacturers and major European automakers. Tesla has also faced public backlash linked to CEO Elon Musk’s political support for US President Donald Trump and other far right politicians which analysts say may have influenced buyer sentiment.
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