Tesla reported a second consecutive quarterly decline in global vehicle deliveries, posing a significant challenge for the company to achieve its ambitious annual growth targets. In the second quarter, Tesla delivered 384,122 vehicles, representing a 13% decrease from the same period last year.
In its Q2 2025 report, Tesla detailed production figures of 410,244 vehicles, exceeding some expectations, with 396,835 of these being Model 3 and Model Y units. The company also reported deploying 9.6 gigawatt-hours (GWh) of energy storage products, indicating continued strength in its Megapack and Powerwall segments. Tesla will release its full second-quarter financial results and conduct a Q&A webcast on Wednesday, July 23. During this call, investors are expected to inquire about the ramp-up of the new Model Y across various regions, the expansion of Full Self-Driving (FSD) into new territories, progress on the Robotaxi business, and updates regarding the long-anticipated affordable vehicle models.
Despite the quarterly drop, the delivery figures surpassed analyst projections, with some estimates predicting a decline exceeding 20%. Following the announcement, Tesla shares saw an increase of up to 4% at the opening of regular trading on Wednesday. This delivery report contrasts with statements made by Elon Musk in mid-May, where he claimed that Tesla’s automotive business had recovered from an earlier slump.
Tesla had anticipated a boost in the second quarter from the refreshed Model Y sport utility vehicle. However, the company’s largely unchanged vehicle lineup faces increasing competition, particularly from Chinese EV manufacturers like BYD Co. and Xiaomi Corp. in their domestic market. Concurrently, General Motors Co. is expanding its presence in the US electric vehicle market.
Earlier in April, Tesla informed investors that new, more affordable vehicle models were on track for production in the first half of the year. The absence of these cheaper models in the current quarter has led several analysts to speculate about potential delays in their launch. Most analysts now forecast that Tesla will report its second consecutive annual decline in vehicle sales, with Bloomberg-surveyed analysts collectively projecting approximately 1.65 million deliveries for 2025, an estimated 8% decrease from 1.79 million last year.
Tesla’s management had previously tempered its January prediction of a return to vehicle business growth this year. In April, executives indicated they would reassess their outlook during the upcoming earnings report. Despite this, Elon Musk stated on May 20 that Tesla’s deliveries had recovered, and that the company did not foresee any significant demand shortfall moving forward. “The sales numbers at this point are strong and we see no problem with demand,” Musk commented in an interview.
Musk is now assuming increased direct oversight of Tesla’s automotive business following the departure of Omead Afshar, a close confidant who was responsible for North American and European sales and manufacturing operations. Tesla’s sales operations in the US and Europe will now report directly to Musk. Concurrently, Tom Zhu, a senior vice president, will continue to manage sales in Asia and will take on global manufacturing operations.