Tesla Inc. has experienced its first-ever annual drop in shipments from its Shanghai Gigafactory since it began mass production in 2020, a clear indication of growing competition in the Chinese market and weakening global demand for electric vehicles, Bloomberg reports.
According to preliminary data released by China’s Passenger Car Association (PCA) on Friday, the Elon Musk-led automaker delivered 916,660 electric vehicles from its Shanghai facility in 2024, a 3% decrease compared to the previous year. This marks a significant setback for Tesla, whose Shanghai factory is its first outside of the United States.
Despite a series of year-end incentives, Tesla’s December shipments from the Shanghai plant remained stagnant compared to the same month in 2023, totaling 93,766 China-built Model 3 sedans and Model Y SUVs.
The figures represent another disappointing milestone for Tesla, which also saw its annual global sales decline for the first time in over a decade. This comes as investors are increasingly questioning Musk’s ambitious sales growth target of 20-30% for 2025. Concerns are growing about the potential rollback of EV tax credits under the incoming Trump administration and the continued pressure from rapidly growing Chinese competitors, particularly BYD Co.
Globally, Tesla delivered 1.79 million electric vehicles in 2024, slightly less than the number of cars sold in 2023 and falling short of analysts’ consensus estimates.
Meanwhile, BYD, which completely ceased production of fossil fuel-powered vehicles in 2022, sold 1.76 million battery-powered vehicles, closely matching Tesla’s performance in the pure EV market. When including hybrid vehicles, BYD’s total passenger vehicle sales reached an impressive 4.25 million.
The broader new-energy vehicle market in China showed strong growth in December, with wholesale deliveries estimated at 1.5 million units, a 35% increase year-on-year, according to PCA data.
