The real impact on Tesla sales as Elon Musk continues to face backlash

Are Californians falling out of love with Tesla?

The electric car brand has experienced a significant sales decline in the Golden State amid backlash against its CEO Elon Musk.

Tesla’s electric-vehicle registrations dropped by 15.1 per cent during the first quarter of 2025, indicating a steep sales decline and growing challenges for the carmaker in the US market.

The carmaker’s share of the electric vehicle (EV) market in California fell to 43.9 per cent from 55.5 per cent a year earlier, according to the California New Dealers Association. Meanwhile, sales of all other EVs increased 35 per cent.

“An ageing product lineup and backlash against Elon Musk’s political initiatives are likely key factors for the decline in the Tesla BEV market share,” the industry body said in its quarterly report.

The Model Y remained the bestselling electric car in California, however its sales dropped about 30 per cent in the first quarter, compared to its sales a year earlier.

This month Tesla said it experienced several weeks of lost production during its first quarter due to retooling production lines for its refreshed Model Y at four of its factories.

A Tesla dealership in Corte Madera, CaliforniaGetty

Why are Tesla’s sales falling?

Although it’s difficult to pinpoint the slump to one event, increased competition as well as Musk’s politics are likely key factors.

Beginning in 2025, there have been a growing number of incidents targeting Tesla cars and dealerships as part of a larger wave of protests against Musk. The tech billionaire’s heavy-handed approach to cutting jobs as a key figure of the Department of Government Efficiency (DOGE) has sparked outrage in the US.

Activists are protesting against federal workforce cuts and the cancellation of contracts funding humanitarian programmes across the globe. President Donald Trump publicly supported his pal and Tesla by promoting the car brand with an odd photo-op outside the White House. He also threatened to deport Tesla "terrorists" to El Salvador for vandalising the brand's cars. Neither action has apparently improved Tesla's fate on the west coast.

The sales slump in California is particularly alarming, given the state’s deep-rooted love affair with electric vehicles, and with Teslas in particular. In the Golden State, spotting a Tesla on the road is almost as common as sunshine itself, largely due to its eco-conscious culture and progressive climate policies.

California offers government grants and rebates to make EVs more affordable, including the Clean Vehicle Assistance Program. As a result, EV sales in California are among the highest in the US, with more than 2 million zipping around.

The state has long driven the adoption of EVs across the US, which appears likely to persist. However, the latest figures reveal a stark shift: drivers are increasingly gravitating toward rival brands, signalling that Tesla’s once-unshakable grip on the state’s roads may be slipping.

You should also read:

• Elon Musk told to 'step up as Tesla boss' as patience wears thin amid stocks tanking
• Tesla dealt another major blow after the company booted out of international car show

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