Tesla Sales Dive 13% to Three-Year Low Amid Elon Musk’s Controversies and China Demand Drop

Tesla is grappling with a 13% drop in sales, marking its weakest quarter since mid-2022. The financial strain is linked to CEO Elon Musk’s controversial social media presence and escalating competition from Chinese electric vehicle manufacturers. Tesla’s deliveries hit 336,681 vehicles in early 2023, significantly short of the anticipated 390,000, while the company produced 362,615 units. Amid protests against Musk’s political activities—including allegations of a Nazi salute—Tesla faces increasing vandalism directed at its vehicles and infrastructure.

Analysts label these results “disappointing,” with industry experts like Dan Ives suggesting Musk’s political engagement harms the brand’s image more than ever. Simultaneously, as competition from firms like BYD and Geely intensifies, many consumers are reevaluating their choice of electric vehicles.

The firm hopes to rebound as it ramps up production of the revamped Model Y mini-crossover and offers incentives like reduced pricing and free charging to attract buyers. However, with import tariffs looming, Tesla’s pricing structure could face further pressure, posing challenges for future sales. Despite this, Musk recently emphasized Tesla’s Model Y as a market leader in China, yet the reality of broader sales trends suggests a critical juncture for the company.