Tesla’s troubles are mounting in a few key regions | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

If you measure the company by its only current product, cars, Tesla is in trouble.

Last week, the electric vehicle maker reported its fourth-quarter delivery and production numbers, and the results weren’t great.

The company delivered 418,000 vehicles in the quarter, exceeding the 15% year-over-year decline to 422,000 vehicles that analysts polled by Tesla had expected. For the year, they expected 1.64 million deliveries, an 8.6% decline, which Tesla achieved.

Tesla Q4 delivery data

Q4 Model 3 and Y deliveries: 406,585
Q4 all other models deliveries: 11,642
Q4 Model 3/Y production: 422,652
Q4 all other models production: 11,706

The year 2025 is the second consecutive one in which Tesla delivered fewer cars than it did the previous year. Tesla delivered 1.79 million vehicles in 2024 while producing 1.77 million. In 2023, the company delivered 1.81 million cars and produced 1.85 million.

CEO Elon Musk will undoubtedly have something to say about the year’s results during the company’s earnings call after the market close on Wednesday, January 28, and investors will be on the call.

While the company does not break out its sales by region, there is evidence that the company’s decline has been driven by rough spots in China and Europe, the two largest electric vehicle markets in the world.

Tesla’s Shanghai factory was busy in December, but sales still fell in the region year over year.

Chu/Getty Images

Tesla deliveries fall in China for the first time

In November of last year, Tesla reported that sales of vehicles produced at its Shanghai Gigafactory increased by 9.9% year over year. Sales of Model 3 and Model Y vehicles produced at the factory increased 41% month over month, according to data from the China Passenger Car Association, cited by Reuters.

While Tesla Shanghai delivers to many regions outside of China, the numbers represented good news for the car company after sales in China dropped to a three-year low in October.

World’s top EV markets in 2024

China: 6.4 million EVs sold
Europe: 2.2 million EVs sold
U.S.: 1.2 million EVs sold
Rest of world: 1 million EVs sold Source: International Energy Agency

Going into December, Tesla had sold nearly 532,000 vehicles in China, according to data crunched by Electrek.

Tesla sold more than 657,000 EVs in China last year, so it needed to sell another 125,000 in the final four weeks to match last year’s total.

But Tesla Shanghai only produced 97,171 units in the month. So, despite Giga Shanghai producing at full capacity in the month, it would not create enough vehicles to meet the number needed to surpass last year’s delivery total.

Additionally, China’s robust EV industry is showing signs of fracture.

BYD, the company most responsible for China’s green vehicle revolution, is now facing a period of slowing growth.

On Sept. 4, BYD cut its 2025 sales target by as much as 16% to 4.6 million vehicles.

But China isn’t the only region where Tesla is struggling. The company is also struggling in Europe.

Tesla’s long-term downturn in Europe

Tesla’s downturn in Europe has been a long time coming, and it doesn’t seem to be letting up anytime soon.

The company reported falling sales across the European region for most of 2025, driven by numerous issues, including CEO Elon Musk’s increased involvement in politics.

While Musk promised investors that he would spend more time at Tesla HQ in Austin once his time in D.C. ended, he has instead flirted with starting his own political party and spends much of his social media bandwidth commenting on government concerns.

Musk has publicly endorsed the AfD, a German right-wing party that some view as extremist, and he was accused of doing a Nazi salute on stage.

Tesla’s sales in Europe declined by nearly 40% from January to April compared to the same period last year. In June, sales dropped another 39%. According to the European Automobile Manufacturers Association, Tesla’s first-half sales were down 44% in Europe.

That trend followed into the second half of the year across the continent, including the United Kingdom.

Tesla UK deliveries end the year on a sour note

UK registrations of Tesla vehicles dropped by more than 29% in December to 6,323, according to data from New AutoMotive, cited by Reuters.

While Tesla remains the most popular electric vehicle in the region, BYD, Tesla’s biggest competitor in China and Europe, saw registrations jump nearly fivefold to 5,194.

According to Reuters data, Norway was the only major European market to report an increase in sales last year. Sweden and Belgium each reported at least a 50% decline, while the Netherlands fell just short of that threshold.

Portugal, Spain, Italy, Switzerland, and Britain all reported significant declines as well; however, Norway, Italy, and Switzerland reported more than 50% year-over-year increases in December.