Tesla’s TSLA grip on the world’s largest EV market is slipping. In April, the company sold just 58,459 vehicles in China, down nearly 6% from a year ago. The figure also reflected a steep 26% drop from March, according to data from the China Passenger Car Association. In the first four months of 2025, Tesla’s China sales have declined over 18% year over year to 231,213 units.
The numbers are raising red flags. While local rivals are posting strong growth, Tesla is struggling with an aging product lineup and rising competition. The recent Model Y refresh did little to spark excitement, and public perception of the brand, soured by CEO Elon Musk’s controversies amid his political moves, isn’t helping.
Weak delivery numbers across all key markets (including the United States, China and Europe) are making it harder to believe that Tesla can report sales growth for full-year 2025. Ongoing global tariff uncertainty and weakness in China remain concerns, prompting Tesla not to reaffirm its 2025 delivery guidance. Musk had already walked back his 2025 vehicle growth target from 20-30% to more modest expectations on the fourth-quarter earnings call. But now he has refrained from reiterating even that modest growth.
Meanwhile, the excitement around its upcoming robotaxi reveal on June 1 may not be enough to distract from the core issue — falling EV sales. Tesla may call itself a tech company, but without strong vehicle demand, the story falls apart. Investors’ patience on the stock is already running out and such weak numbers will only worsen things. Unless Tesla can reverse its sales decline, its stock could be in for a rougher ride.
Chinese EV Makers Gaining Ground
While Tesla deliveries in China dropped, companies like NIO Inc. NIO, Li Auto LI and XPeng XPEV saw a sales surge.
NIO delivered 23,900 vehicles in April, demonstrating 53% growth on a year-over-year basis. The total deliveries comprised 19,269 units of the NIO brand itself. NIO’s ONVO and Firefly brands are expected to boost deliveries further.
XPeng’s deliveries totaled 35,045 in April, increasing 273% year over year and exceeding 30,000 units for the sixth consecutive month. XPeng MONA M03’s cumulative delivery surpassed 100,000 units, and its XPENG P7+ model achieved its 50,000th vehicle production milestone in just five months from its launch.
LI Auto delivered 33,939 vehicles last month, up 31.6% year over year. In the first four months of 2025, Li Auto’s deliveries totaled 1,260,675 units.
Tesla’s Price Performance, Valuation and Estimates
Shares of Tesla have lost more than 30% year to date.
Image Source: Zacks Investment ResearchFrom a valuation standpoint, Tesla trades at a forward price-to-sales ratio of 8.41, way above the industry. TSLA carries a Value Score of F.
Image Source: Zacks Investment ResearchThe Zacks Consensus Estimate for Tesla’s 2025 earnings implies a 22% drop year over year.
Image Source: Zacks Investment ResearchThe stock currently carries a Zacks Rank #5 (Strong Sell).
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Tesla, Inc. (TSLA): Free Stock Analysis Report NIO Inc. (NIO): Free Stock Analysis Report Li Auto Inc. Sponsored ADR (LI): Free Stock Analysis Report XPeng Inc. Sponsored ADR (XPEV): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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