Due to pressure from competitors and the reaction against CEO Elon Musk's political beliefs, Tesla is anticipated to post another decline in quarterly deliveries on Wednesday.

The majority of Tesla's current income and profits come from its primary business of selling electric vehicles, which has been under pressure from high borrowing rates and growing competition.

However, Musk's wager on commercializing robotaxis accounts for a large portion of Tesla's trillion-dollar valuation.

The global EV industry has been expanding, albeit more slowly than in prior years, but in 2024, Tesla's aging lineup saw a decline in yearly sales for the first time.

Although Musk has stated that sales will increase again in 2025, reversing his earlier pledge of 20–30 percent growth, analysts predict an eight percent drop in sales this year.

According to 23 experts surveyed by Visible Alpha, Tesla is anticipated to produce 394,380 units for the second quarter that concluded in June. Following a 13 percent drop the company reported in the prior quarter, it would represent a drop of more than 11 percent year over year.

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According to analysts, many buyers were waiting orders as they awaited the release of the updated Model Y SUV, which Tesla claimed was the reason for the production halt in the fall of last quarter.

Rather, fewer Teslas were purchased. Musk's open support of far-right parties in Europe and his work for US President Donald Trump, who is in charge of slashing federal funding and jobs, annoyed some potential consumers.

 

Even though Musk has returned his attention to his businesses, the backlash and consumers' preference for less expensive Chinese EVs caused Tesla's sales in Europe to decline for the fifth consecutive month in May, dropping 27.9 percent, according to data from the European Automobile Manufacturers Association.

Tesla's market share in China has decreased from 10 percent last year and a peak of 15 percent in 2020 to 7.6 percent for the first five months of 2025 as rivals have captured consumers' attention with sleek, modern, feature-rich EVs. Hours after going on sale last week, Xiaomi's YU7 SUV garnered incredibly high orders, which fueled rumors that Tesla could have to lower costs in retaliation.

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If those second-quarter projections are correct, Tesla would have to turn over more than a million units in the second half to meet Musk's goal of growing again this year. This would be a record and a difficult task, according to Wall Street analysts, even though sales are usually higher in the second half.

Tesla has stated that it will begin manufacturing its lower-cost model by the end of June, which is anticipated to be a simplified Model Y.

Tesla's stock has recovered somewhat since plunging early this year due to irate anti-Musk demonstrations. About a dozen robotaxis were introduced by the business last month in a restricted area of Austin, Texas, transporting a select few invited fans for a small charge, but with safety monitors and other limitations.