NEW YORK – Tesla has reported a 13.5% year-on-year drop in global vehicle deliveries for the second quarter of 2025, highlighting mounting challenges facing the electric vehicle maker as it grapples with intensifying market competition and growing political backlash tied to its CEO.
The company delivered 384,122 vehicles between April and June, down from 443,956 units during the same period last year. The results mark Tesla’s second straight quarterly decline in sales, reflecting a more crowded and competitive electric vehicle market that now includes aggressive players such as China’s BYD and legacy automakers like General Motors, Toyota, and Volkswagen.
Despite the decline, Tesla shares rose 2.8% in early trading Tuesday, as the figures were broadly in line with analyst expectations and slightly better than some of the more bearish forecasts made in recent days.
However, the drop in deliveries also comes amid renewed controversy surrounding Tesla CEO Elon Musk, whose political involvement has stirred criticism and calls for boycotts. Musk’s open support for former U.S. President Donald Trump—along with a reported donation of over US$270 million to Trump’s 2024 campaign—has led to increased scrutiny of Tesla’s brand, particularly among more progressive consumers.
The relationship between Musk and Trump has since soured. Following the U.S. election, Musk was appointed to lead the Department of Government Efficiency (DOGE), a newly formed body that oversaw sweeping job cuts in the federal workforce. But tensions escalated after Musk criticised the White House’s key tax and spending bill, calling it wasteful and referring to its supporters as promoting “debt slavery” on social media.
In retaliation, Trump reportedly threatened to target Musk’s businesses and floated the idea of deporting the South African-born billionaire.
Tesla shares dropped more than 5% on Monday following the public feud, before recovering slightly with the Q2 delivery report.
While the latest numbers may have reassured investors in the short term, analysts warn that Tesla faces deeper structural challenges, including the need for fresh product offerings and reputational repair. As the global EV market continues to evolve rapidly, Tesla’s ability to adapt—both commercially and politically—will likely define its trajectory in the coming quarters.
