Tesla’s electric vehicle sales in China dropped again in May, marking the eighth consecutive monthly decline.
According to the China Passenger Car Association, the company delivered 61,662 locally built Model 3 and Model Y vehicles.
That figure represents a 15% year-on-year drop, following a 6% decline in April.
Price Wars and Competition Take a Toll
Although deliveries rose 5.5% from April’s total, the broader trend remains negative.
Tesla’s decline has been exacerbated by fierce price competition and a limited lineup of aging models.
The automaker, which started a price war in China in 2023, now faces over 40 rivals in the same space.
Despite the fierce competition, Chinese authorities have urged automakers to pull back from aggressive price cuts.
Yet companies like BYD, Geely, and Chery continue offering new incentives, keeping the pressure high.
Sales Drop Extends Beyond China
Tesla’s woes aren’t confined to China.
In Europe, the EV maker has also seen sales suffer.
Analysts suggest that CEO Elon Musk’s polarizing political views and a lack of model updates have hurt Tesla’s image among European buyers.
Push for Recovery Through Promotions
To revive demand, Tesla launched new offers in China, including assisted driving upgrades for buyers through June.
For the first time, the company’s vehicles were also added to a government initiative aimed at boosting EV adoption in rural areas.
These efforts reflect Tesla’s attempt to counteract the growing appeal of newer, more affordable models.
Rival BYD Continues to Outpace Tesla
Tesla’s biggest competitor in China, BYD, reported strong numbers once again.
The company sold 376,930 passenger vehicles globally in May, marking a 14.1% year-over-year increase.
Though slower than April’s 19.4% growth, the figures highlight BYD’s continued momentum amid Tesla’s ongoing struggles.
With China remaining the world’s largest EV market, the competition for dominance is only intensifying.