Tesla's EV market share falls below 40% for the first time in the US

[midian182]

What just happened? Tesla is not having a good time right now. Sales have been struggling for a while, and the company's US EV market share has dropped to a near eight-year low of under 40%. The primary reason is that there are a huge number of alternative electric vehicles available today, most of which are newer than Tesla's aging lineup.

According to research firm Cox Automotive, which shared its latest EV sales data with Reuters, Tesla vehicles made up 38% of total US EV sales in August.

Tesla's US EV share hasn't fallen below the 40% mark since October 2017, back when it was ramping up the production of its first mass market car, the Model 3.

The data also reveals that Tesla's US EV market share fell from 48.7% in June to 42% in July, its sharpest drop since March 2021, around the time when Ford released the Mustang Mach-E EV.

Tesla sales have been struggling in recent times. The company delivered around 1.79 million vehicles in 2024, down from about 1.81 million in 2023, marking its first annual drop since 2011. Production dipped even more sharply, falling nearly 4% in 2024 compared to 2023.

Tesla is on track for a second year of sales decline. It delivered 384,122 vehicles in the second quarter of 2025, marking a 13.5% drop compared to the 443,956 units a year ago. The Cybertruck is having an especially tough time.

There's no doubt that CEO Elon Musk's previously close relationship with Donald Trump and his tenure as head of cost-cutting agency DOGE harmed Tesla sales among many people, particularly in Europe.

But much of the problem comes from EV rival companies pushing out newer and cheaper alternatives. Rivian and other US automakers are competing with Tesla domestically, while Chinese companies such as BYD are making huge strides in Europe and their home market – Tesla sales in China fell 9.9% year-over-year in August, and year-to-date sales in the country are down about 7% compared to 2024.

In addition to its core EV business, Tesla focuses on areas such as robotics and robotaxi while most rivals don't have such distractions. The refreshed Model Y, meanwhile, has not been a huge success.

Even though its market share fell in July, Tesla sales were up month-on-month 7% to 53,816. But overall sales of new EVs were up more than 24% MoM as buyers looked to take advantage before the $7,500 tax credit ends. Rival EV makers saw their sales increase between 60% and 120%.

Tesla's shares are up slightly today, though that's related to the potential $1 trillion compensation plan for Musk designed to keep his "focus and attention" on the company. The package is set for a shareholder vote on November 6.

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Tesla's EV market share falls below 40% for the first time in the US

 

[GodisanAtheist]

Musk's biggest mis-step was giving people a reason to look at alternatives.

If he had shut up, kept his head down, and kept plugging away at his various projects Tesla's competitors would have undoubtedly nibbled away a little bit of marketshare, but not the mouthfuls they are taking at the moment.

Success is always a combination of ability and opportunity, and Musk gave his competitors a cybertruck sized hole to exploit.

 

[PXAbstraction]

In the words of Justin Timberlake: "Cry me a riveeeeeeer."

I'm Musk's new $1T incentive package will convince him to sort this out straight away.

 

[m4a4]

Oh no. Competition. How horrible and unnatural.

 

[WhiteLeaff]

They're *****s, instead of focusing on the Model 2 for the masses, the megalomaniac wants "autonomous driving" to force a higher price with this feature stick. The majority don't give a damn about that, they just want a car at a good price, safe and reliable.

 

[wiyosaya]

IMO, it would be interesting to see a stat that tells how many EVs were sold in the US and how many of them were Teslas.

There's more competition now, and even if Tesla sells more EVs than any other EV Maker,I don't think that is as meaningful as it used to be. I see more and more EV VWs, BZX4s, and other brands. I think Tesla's days in the lead are numbered.

 

[Plutoisaplanet]

Oh no. Competition. How horrible and unnatural.

You would think with news like this, Tesla is doing horribly and yet Tesla EVs are only barely being outsold by the top European brands in their own market. In fact, Tesla still has the #1 and #3 best selling EV models in Europe. In the US on the other hand, they're still dominating. The #2 EV brand in the US in Q2 was GM with 1/3 the sales that Tesla has. I noticed in the source article GM that was completely omitted. Well in Q2, GM also sold double what Hyundai did, triple what Ford did, quadruple what VW did, and the numbers diminish even further.

But these small players in the US EV market are who Reuters is hyping up lol (the source of this article's news). They also admit that they depended on significant discounts in order to convince customers to choose their vehicles. I'll tell you the reason why--these companies probably plan to wind down their EV production and don't want to deal with leftover inventory of cars they can't sell. Of course reporting actual sales figures or market shares would reveal ANY of this, so these numbers were completely omitted from Reuter's article: https://caredge.com/guides/electric-vehicle-market-share-and-sales

 

[maxxcool7421]

You would think with news like this, Tesla is doing horribly and yet Tesla EVs are only barely being outsold by the top European brands in their own market. In fact, Tesla still has the #1 and #3 best selling EV models in Europe. In the US on the other hand, they're still dominating. The #2 EV brand in the US in Q2 was GM with 1/3 the sales that Tesla has. I noticed in the source article GM that was completely omitted. Well in Q2, GM also sold double what Hyundai did, triple what Ford did, quadruple what VW did, and the numbers diminish even further.

But these small players in the US EV market are who Reuters is hyping up lol (the source of this article's news). They also admit that they depended on significant discounts in order to convince customers to choose their vehicles. I'll tell you the reason why--these companies probably plan to wind down their EV production and don't want to deal with leftover inventory of cars they can't sell. Of course reporting actual sales figures or market shares would reveal ANY of this, so these numbers were completely omitted from Reuter's article: https://caredge.com/guides/electric-vehicle-market-share-and-sales

this is market saturation nothing more.. move along

 

[Plutoisaplanet]

They're *****s, instead of focusing on the Model 2 for the masses, the megalomaniac wants "autonomous driving" to force a higher price with this feature stick. The majority don't give a damn about that, they just want a car at a good price, safe and reliable.

Tesla isn't focusing on a cheaper automobile for the masses anymore lol. It will be cheaper and it will be self-driving, but the primary reason is for transportation as a service. They plan to completely eclipse ride-sharing companies by selling rides at a fraction of the price. This is done by driving down the costs of the car, maintenance, fuel, and labor. Some self-driving cars will be owned and operated by third-party companies, and some will be sold by Tesla. As a consumer, if you can have cars that are at a good price and safe, BUT you don't have to own, operate or maintain them, it's going to change the market completely.

Of course this will take years to grow/bring down costs. And the end goal will be to make rides affordable enough to complete with transportation everywhere, but obviously the focus is existing markets first. For now, labor will still be required (obviously the cars aren't fully self-driving) but eliminating that will make a difference. But the cost and longevity of the car is also key to the price... And that specifically is why Waymo is in a bad position.

IMO, it would be interesting to see a stat that tells how many EVs were sold in the US and how many of them were Teslas.

There's more competition now, and even if Tesla sells more EVs than any other EV Maker,I don't think that is as meaningful as it used to be. I see more and more EV VWs, BZX4s, and other brands. I think Tesla's days in the lead are numbered.

The source article only lists Tesla and total EVs in the market. It's pretty annoying lol. Tesla sold 53,816 / 128,268 EVs in August specifically. Last quarter, GM was the #2 EV automaker with 46,280 vehicles.

 

[AnilD]

Tesla’s biggest competitor right now isn’t Rivian or BYD, it’s the fact that most people want a car built after 2020. Tesla went from “we’re the iPhone of cars” to “we’re that one friend still using an iPhone 8 but insisting it’s fine.”

 

[wiyosaya]

The source article only lists Tesla and total EVs in the market. It's pretty annoying lol. Tesla sold 53,816 / 128,268 EVs in August specifically. Last quarter, GM was the #2 EV automaker with 46,280 vehicles.

Tesla is losing its lead.

 

[Plutoisaplanet]

Tesla is losing its lead.

This is what the article said:

Sales of new EVs jumped more than 24% month over month in July to 128,268, according to the Cox data, driven by the looming end of a $7,500 tax credit for EVs and attractive deals. Tesla saw sales rise 7% to 53,816, even as its market share fell.
[...]
The July data showed rivals outgrowing Tesla. Hyundai, Honda, Kia and Toyota rolled out higher incentives than Tesla and drove up EV sales between 60% and 120%, boosting market share.
"These legacy manufacturers are all benefiting from this sense of urgency, and they're able to have attractive offerings for their vehicles - and it's working," Streaty said. "I think we're going to continue to see this momentum through September."

This is going to be unsustainable for these automakers, and it supports everything I said that this is a one time thing (only until the end of September) to clear out inventory. Yes Tesla is losing ground this quarter, but these competitors don't want to take the lead unless they can benefit from subsidies because no one will want to buy their vehicles at a higher price after the incentives go away. They will not be able to sell an attractive EV at a reasonable price to take the lead afterwards. Instead, they will reduce EV production (or deal with oversupply). Hyundai and Kia might be exceptions; in my opinion they actually have attractive looking EVs.

Just to note, when the article says it drove EV sales up 60-120%, none of the automakers listed are even the #2 automaker but typically sell 10,000 vehicles PER QUARTER. If they managed to 10x their sales, they would not catch up to Tesla lol. See my previous citation for supporting information (it actually lists out all numbers, not cherry picked ones lol).

 

[toooooot]

A tip for tesla: if you are not going to restyle the lineup (seriously, why are we still using this outdated design?) then at least introduce new premium looking colors. I look at new German cars and colors convey luxury, they are not typical black/gray/white tesla does.

Add new cool colors. How about bright red for example? Pearl paints, metalic. Make it fun.

 

[toooooot]

They're *****s, instead of focusing on the Model 2 for the masses, the megalomaniac wants "autonomous driving" to force a higher price with this feature stick. The majority don't give a damn about that, they just want a car at a good price, safe and reliable.

Look, the first company to get to the finish line with working autonomous driving will reap most of the profits. It is the thing in automotive industry. You must be first to get the most money.
Besides, even today, self-driving cars are attractive to a variety of people. Imagine owning taxy service where cars cost the same as non self driving cars but you do not have to pay a penny to drivers.
Money, they can smell it and are ready to spend billions. Just because they are not there, it does not mean that this will be the reality in the next decade.

 

[PXAbstraction]

Oh no. Competition. How horrible and unnatural.

"We can't run an oligarchy this way!"

 

[PXAbstraction]

You would think with news like this, Tesla is doing horribly and yet Tesla EVs are only barely being outsold by the top European brands in their own market. In fact, Tesla still has the #1 and #3 best selling EV models in Europe. In the US on the other hand, they're still dominating. The #2 EV brand in the US in Q2 was GM with 1/3 the sales that Tesla has. I noticed in the source article GM that was completely omitted. Well in Q2, GM also sold double what Hyundai did, triple what Ford did, quadruple what VW did, and the numbers diminish even further.

But these small players in the US EV market are who Reuters is hyping up lol (the source of this article's news). They also admit that they depended on significant discounts in order to convince customers to choose their vehicles. I'll tell you the reason why--these companies probably plan to wind down their EV production and don't want to deal with leftover inventory of cars they can't sell. Of course reporting actual sales figures or market shares would reveal ANY of this, so these numbers were completely omitted from Reuter's article: https://caredge.com/guides/electric-vehicle-market-share-and-sales

And yet with all that, selling carbon credits is still the only thing that keeps Tesla profitable.

 

[PXAbstraction]

Look, the first company to get to the finish line with working autonomous driving will reap most of the profits. It is the thing in automotive industry. You must be first to get the most money.
Besides, even today, self-driving cars are attractive to a variety of people. Imagine owning taxy service where cars cost the same as non self driving cars but you do not have to pay a penny to drivers.
Money, they can smell it and are ready to spend billions. Just because they are not there, it does not mean that this will be the reality in the next decade.

It won't be. It's not even remotely on track to be widely and safely deployable in that time frame, especially with Musk insisting Tesla use inferior technology (low resolution cameras only) to power it. If I'm wrong, I'm wrong, but this was supposed to be in full swing years ago according to him and there's been barely any progress made so I'm not holding my breath. FSD is as big a hype bubble as AGI right now, though at least FSD is at least realistically possible in our lifetime.

 

[WhiteLeaff]

Look, the first company to get to the finish line with working autonomous driving will reap most of the profits. It is the thing in automotive industry. You must be first to get the most money.
Besides, even today, self-driving cars are attractive to a variety of people. Imagine owning taxy service where cars cost the same as non self driving cars but you do not have to pay a penny to drivers.
Money, they can smell it and are ready to spend billions. Just because they are not there, it does not mean that this will be the reality in the next decade.

I'm pretty sure it won't. It's too fragile and dangerous. But you can believe whatever you want.

 

[Plutoisaplanet]

And yet with all that, selling carbon credits is still the only thing that keeps Tesla profitable.

That's a lie lmfao, there is literally no source that will say that. Carbon credits counted as 16% of their gross profits last year and it's been lower than that for at least half a decade. Even on a quarterly basis it's not true. In fact, in Q2 Tesla increased their profits while decreasing income from carbon credits.

 

[Plutoisaplanet]

A tip for tesla: if you are not going to restyle the lineup (seriously, why are we still using this outdated design?) then at least introduce new premium looking colors. I look at new German cars and colors convey luxury, they are not typical black/gray/white tesla does.

Add new cool colors. How about bright red for example? Pearl paints, metalic. Make it fun.

You mean you don't like the idea of having a car with unpainted, brushed stainless steel?

 

[Karlos95]

So many hate tesla, yet still remains above most other manufacturers.. what does that say about your Elon hating cult?

 

[toooooot]

You mean you don't like the idea of having a car with unpainted, brushed stainless steel?

I like premium looking paint. It is pleasant to look at. Cybertruck is alright, but it is just not the best look.

 

[p51d007]

I just wish ALL the manufactures of automobiles would go back to designing and making vehicles that ALL DON'T LOOK ALIKE!
Heck, have the time you see all these silly SUV's on the road, one looks like the other.
Now, everything is about "euro style"...screw that! I'd rather cars go back to looking like cars.

 

[Karlos95]

I just wish ALL the manufactures of automobiles would go back to designing and making vehicles that ALL DON'T LOOK ALIKE!
Heck, have the time you see all these silly SUV's on the road, one looks like the other.
Now, everything is about "euro style"...screw that! I'd rather cars go back to looking like cars.

It's by design. Look at buildings and houses. They want mediocracy. No one thinking too big.

 

[Underdog]

I just wish ALL the manufactures of automobiles would go back to designing and making vehicles that ALL DON'T LOOK ALIKE!
Heck, have the time you see all these silly SUV's on the road, one looks like the other.
Now, everything is about "euro style"...screw that! I'd rather cars go back to looking like cars.

That's my beef, also. These days you have to get really close to the badge to identify what it is. In the past I could identify make and model from half a block away. Now they're all clones and mostly black, white, or grey, as mentioned in a previous post. I guess maybe the industry took advantage of a job lot of cheap paint, all monochrome. And brand identity was considered obsolete so all the new SUV things look like they escaped from a crusher. What is an SUV anyway? Too high off the ground for any sort of "sports" cornering. They seem too eager to tip over when cornering or clipping a kerb. I think SUV must stand for "Seriously Ugly Vehicle". Even the Edsel had its own character.