Tesla’s (TSLA) sales of China-made EVs plummeted 49% year-over-year in February amid the soaring competition in the region. According to data from the China Passenger Car Association (CPCA), Tesla sold just 30,688 EVs in February, marking its lowest sales since August 2022. Meanwhile, the monthly decline was even steeper, as deliveries plunged 51.5% compared to January. TSLA stock declined around 2% in pre-market trading on Tuesday.
Tesla, which manufactures the Model 3 and Model Y in China, sold 93,926 China-made vehicles globally in the first two months of the year, marking a 28.7% decline year-over-year.
Tesla Loses Ground in China as Local Rivals Surge
As Tesla struggled to hold its position in China, local rivals surged with strong sales growth in February. Leading the charge, BYD (BYDDF) sold 322,846 NEVs (new energy vehicles) in February, marking a 164% year-over-year growth and a 7.42% increase from 300,538 in January.
Similarly, Li Auto (LI) reported 26,263 vehicle deliveries in February 2025, reflecting a 29.7% year-over-year growth. Meanwhile, Nio (NIO) delivered 13,192 vehicles, reflecting a 62.2% year-over-year increase but a 4.8% decline from January.
On a positive note, Tesla has started delivering its Model Y Juniper in China, claiming that it can compete strongly against local rivals. However, with intense competition in the electric mid-size SUV market, the Model Y’s ability to sustain the success of its pre-facelift version remains uncertain.
Tesla’s Struggles Aren’t Just in China
Tesla’s sales slump isn’t limited to China, as other European markets show similar trends. In February, sales in France tumbled 26% year-over-year, highlighting the company’s ongoing challenges in the region.
Meanwhile, Tesla’s sales in Scandinavia have slumped, with registrations dropping between 42% and 48% in Sweden, Norway, and Denmark.
Is Tesla a Buy, Sell, or Hold?
Tesla’s stock has tumbled nearly 30% year-to-date, erasing billions from its market capitalization and fueling debate over the company’s growth prospects.
On Wall Street, analysts have maintained a neutral stance on Tesla stock. According to TipRanks, TSLA stock has received a Hold consensus rating, with 13 Buys, 12 Holds, and 10 Sells assigned in the last three months. The average price target for Tesla shares is $351.38, suggesting a potential upside of 23.4% from the current level.
