Tesla's California EV Registrations Decline Amid Market Challenges
Tesla's electric vehicle (EV) registrations in California saw a 12% drop last year, indicating formidable obstacles for the automaker in a crucial US market. Rising interest rates, heightened competition, and the launch of a redesigned Model 3 sedan impacted Tesla's sales in the state.
The company's decline may have been amplified by CEO Elon Musk's involvement in the US election. The California New Car Dealers Association stated in a report that Tesla's dominance in the EV sector continues to wane, with the brand experiencing its fifth consecutive quarterly registration loss.
Despite the setbacks, the Model Y crossover remains California's top-selling vehicle, with approximately 129,000 units sold last year. The Model 3 sedan trailed in second place, with around 53,000 deliveries. Data collected by the industry body indicates that Model 3 sales plummeted 36% year-over-year, as first reported by Bloomberg News.
Tesla's global deliveries faced a decline for the first time last year, driven by increased borrowing costs and competition from Chinese and European automakers. Reuters exclusively disclosed plans by Donald Trump's transition team to eliminate the $7,500 consumer tax credit for EV purchases. Governor Gavin Newsom's office indicated that if the Trump administration rescinds the federal tax credit for EV purchases, California might introduce state tax incentives. However, Tesla's EVs would likely not be eligible for these incentives.