Tesla reports drop in annual deliveries as EV competition increases

Decline comes as Chinese car maker BYD reports surge in sales

A Tesla Cybertruck. The company's Model 3 and Y vehicles accounted for 1.7 million deliveries, compared to 85,000 for its other models. AFP

Tesla's annual deliveries dropped for the first time last year, the company reported on Thursday, as the electric vehicle maker faces increasing global competition.

The company delivered roughly 1.79 million vehicles last year, short of the roughly 1.8 million vehicles it delivered in 2023. It delivered a record 495,570 vehicles in the fourth quarter, although it fell short of analysts' estimates of 504,000 to 515,000.

It needed to deliver at least 515,000 electric vehicles in the fourth quarter to surpass its 2023 annual performance.

Tesla's Model 3 and Y vehicles accounted for 1.7 million deliveries, compared to 85,000 for its other models.

Chief executive Elon Musk has maintained that the EV maker “is currently between two major growth waves”, driven by next-generation vehicles, full self-driving and other projects.

Earlier on Thursday, Tesla's chief rival for the EV market BYD reported a surge in sales. The Chinese car maker said it had sold 207,734 electric vehicles in December and 1.76 million for the year.

BYD and other Chinese car makers have been trying to increase their sales outside of China, but have faced roadblocks in other major markets such as the US, which imposed a 100 per cent tariff on Chinese-made EVs. The EU in October also ramped up tariffs on imported Chinese EVs to as much as 45.3 per cent.

Tesla is also facing increased competition from domestic and international car manufacturers including Ford, GM, Volkswagen, Hyundai and Kia. Tesla has responded by cutting prices of the Model Y, X and S.

The company's shares were trading 3.65 per cent lower at $389.12 per share during morning trading. Thursday's report followed a post-election surge for the electric car maker, whose stock ended the year up 63 per cent.

Mr Musk dominated headlines last year, spending $277 million to back president-elect Donald Trump and other Republicans during the US election campaign.

The president-elect rewarded Mr Musk by tapping him to co-lead the newly formed Department of Government Efficiency (or “Doge”), which he said was designed to cut government waste.

Tesla is due to release its fourth-quarter financial results on January 29.