Tesla shares decline following a shortfall in fourth-quarter deliveries, marking the company’s first annual sales decrease.
Tesla stock (TSLA) is experiencing a decline as 2025 begins
There was a significant shortfall in fourth-quarter deliveries and an overall challenging year for the electric vehicle manufacturer. In the last quarter, Tesla reported global deliveries of 471,930 vehicles, falling short of analyst expectations of approximately 510,000, as per Bloomberg’s compilation. This number is only slightly higher than the 463,000 vehicles delivered in the previous quarter and is below the 484,500 units delivered during the same period last year.
For the entirety of 2024, Tesla delivered 1.78 million vehicles, which also did not meet analyst forecasts of 1.8 million, resulting in a total that is lower than the 1.8 million vehicles delivered in 2023. This marks the first year-over-year decline for Tesla, suggesting that increased competition, demand fluctuations, and global economic factors may be impacting the company’s performance.
On the first trading day of the year, Tesla’s stock dropped by over 3%.
The announcement of a year-over-year decline in deliveries is likely to surprise investors, especially considering that not long ago, the company was reporting a 50% compound annual growth rate (CAGR). Although Tesla had cautioned last year that its “vehicle volume growth rate may be significantly lower than the growth rate achieved in 2023” due to preparations for launching its next-generation vehicle at Gigafactory Texas, investors likely did not anticipate an annual decline in deliveries.
In contrast, China’s BYD (BYDDY) announced global deliveries of approximately 4.3 million passenger cars in 2024. While Tesla’s primary competitor in China noted that 2.5 million of these were hybrids—marking a shift from previous years—the deliveries still position BYD’s pure electric vehicle total at around 1.76 million, closely approaching Tesla’s figures.
Tesla proponents, on the other hand, perceive this as a temporary setback.
“As we look ahead to fiscal year 2025, we maintain a strong belief in Tesla’s capacity to enhance delivery growth, targeting a 20%-30% increase in deliveries, which is a primary focus for the market. Additionally, TSLA is anticipated to introduce a more affordable electric vehicle in early 2025, which is expected to stimulate growth in vehicle deliveries,” stated Wedbush analyst Dan Ives in a communication to investors on Thursday morning.
Ives further asserts that alongside the anticipated acceleration in vehicle delivery rates in 2025, the growing adoption of Tesla’s full self-driving (FSD) software, the initiation of robotaxi testing, and innovations such as the Cybercab will propel Tesla’s market capitalization to $2 trillion and beyond.
“The primary emphasis for Tesla is the reaccelerated delivery growth narrative for 2025 and the penetration of FSD, with autonomous driving being the overarching vision for Musk and his team. Any decline today due to disappointing fourth-quarter delivery figures presents a strong buying opportunity for us,” Ives remarked.

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