https://arstechnica.com/cars/2026/01/tesla-sales-fell-by-9-percent-in-2025-its-second-yearly-decline/ Skip to content Ars Technica home Sections Forum Subscribe Search * AI * Biz & IT * Cars * Culture * Gaming * Health * Policy * Science * Security * Space * Tech * Feature * Reviews * AI * Biz & IT * Cars * Culture * Gaming * Health * Policy * Science * Security * Space * Tech Forum Subscribe Story text Size [Standard] Width * [Standard] Links [Standard] * Subscribers only Learn more Pin to story Theme * HyperLight * Day & Night * Dark * System Search dialog... Sign In Sign in dialog... Sign in gee, I wonder why? Tesla sales fell by 9 percent in 2025, its second yearly decline Deadly doors, a busted battery bet, and a toxic owner: What's not to like? Jonathan M. Gitlin - Jan 2, 2026 11:30 am | 168 A burned steering wheel A burned steering wheel 14 March 2025, Berlin: A burnt-out Tesla car stands in the Steglitz district of Berlin. Credit: Christophe Gateau/picture alliance via Getty Images 14 March 2025, Berlin: A burnt-out Tesla car stands in the Steglitz district of Berlin. Credit: Christophe Gateau/picture alliance via Getty Images Text settings Story text Size [Standard] Width * [Standard] Links [Standard] * Subscribers only Learn more Minimize to nav Tesla published its final production and delivery numbers this morning, and they make for brutal reading. Sales were down almost 16 percent during the final three months of last year, meaning the company sold 77,343 fewer electric vehicles than it did during the same period in 2024. For the entire year, the decline looks slightly better with a drop of 8.6 percent year over year. That means Tesla sold 1,636,129 cars in 2025, 153,097 fewer than it managed in 2024. Which in turn is more than it managed to shift in 2023. Sales issues Contributing factors to the poor sales are legion. The brand still relies on the Models 3 and Y to an overwhelming extent, and other than a mild cosmetic refresh, neither feels fresh or modern compared with competitors from Europe and Asia. And Elon Musk's much-hyped Cybertruck--which was supposed to cost less than $40,000 and go into production in 2021, lest anyone forget--has been a disaster, eclipsing the Edsel. Its failure has taken down another company initiative, Tesla's "in-house battery cell." It was initially designed specifically for the Cybertruck, although the CEO later claimed it would be used for static storage as well as EVs. But apparently, it has become the victim of a lack of demand. Last week, Electrek reported that Tesla's South Korean battery material supplier L&F wrote down its $2.9 billion contract with Tesla to just $7,386. A drop of more than 99 percent. Musk has not dialed back his embrace of the far right, cratering sales in markets like California and Europe, where EV buyers often use their consciences to guide their wallets. Safety issues And the cars are getting a bad reputation. According to extensive reporting by Bloomberg's Dana Hull, at least 15 people have burned to death in Teslas when the doors became inoperable after a crash, half of which occurred since late 2024. The National Highway Traffic Safety Administration opened an investigation into the topic earlier in 2025. China's regulators have also taken particular issue with Tesla's door handle design, which does not fail in a way that allows it to be opened in an emergency; from January 1, 2027, that design will be banned. More bad publicity followed when some of the victims of Tesla crashes--which far outnumber those killed in Ford Pinto fires--won a $329 million judgment in a wrongful death lawsuit in August. A robotaxi pilot program in Austin, Texas, is mainly notable for the number of times the cars have crashed into things. A purported robotaxi pilot in San Francisco turned out to be nothing more than a conventional ride-hailing service--one that only uses Teslas--with a human driver behind the wheel who might be asleep. If Tesla were any other car company, one would expect heads to roll. You'd also expect talk of a range of exciting new products to tempt customers back into the showrooms. Instead, Musk has fixated on AI, spending billions of Tesla's resources with no benefit to the profit-and-loss sheet. The terrible sales are no mystery, overall. What does remain a mystery is how the company's stock manages to retain its value. At the time of writing, a share of Tesla still costs more than $440, giving it a market cap of $1.4 trillion. Photo of Jonathan M. Gitlin Jonathan M. Gitlin Automotive Editor Jonathan M. Gitlin Automotive Editor Jonathan is the Automotive Editor at Ars Technica. He has a BSc and PhD in Pharmacology. In 2014 he decided to indulge his lifelong passion for the car by leaving the National Human Genome Research Institute and launching Ars Technica's automotive coverage. He lives in Washington, DC. 168 Comments Staff Picks m monkeywrench76 A few other reasons they are not seeing growth, all of which are related to bad decisions by the founder * Any real growth in the US market requires trucks and SUVs * The cyber truck is a complete failure as predicted by any rational person. It is useless as both a truck and a car. The f150 lightning and the Rivian are much better trucks in every way and still struggle * Tesla does not offer a real mid-size to larger SUV. the cars they do offer all look and feel like slightly different versions of each other. From a body style and utility perspective none of them are mid-size to large SUVs and that is where the market is at in the US. Kia EV9, Rivian R1, Ioniq 9, will see growth * There is now competition in the space. First mover advantage is gone * There is now a used tesla car market. Tesla has to compete with their own lease returns. This is something other car companies plan for and understand but tesla did not properly anticipate. * Running a car company is hard, and Elon is too easily distracted by all his crazy ideas and pride. Elon is not the right person to run a sustainable business for numerous reasons. January 2, 2026 at 5:47 pm Comments Forum view Loading Loading comments... Prev story Next story Most Read 1. Listing image for first story in Most Read: Finally, some good news for Russia--the space station is no longer leaking 1. Finally, some good news for Russia--the space station is no longer leaking 2. 2. Marvel rings in new year with Wonder Man trailer 3. 3. "Streaming stops feeling infinite": What subscribers can expect in 2026 4. 4. 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