Tesla has been dethroned as the world’s top-selling electric vehicle maker.

The US automaker endured a challenging year, marked by concerns over CEO Elon Musk’s political engagements and intensifying competition abroad, which drove sales lower for a second consecutive year.

Tesla said it delivered 1.64 million vehicles in 2025, down 9 per cent from the previous year.

Its Chinese rival, BYD, which sold 2.26 million vehicles last year, has now emerged as the world’s largest electric vehicle maker.

Tesla recorded sales of 418,227 vehicles between October and December, below the 440,000 expected by analysts surveyed by FactSet.

The weaker performance may have been partly due to the expiration of a $7,500 (£5,500) tax credit, which was phased out by the Trump administration at the end of September.

Despite these headwinds, Tesla’s stock ended 2025 up about 11 per cent.

Investors are betting that Elon Musk can deliver on his vision of positioning the company as a leader in robotaxi services and driving consumer adoption of humanoid robots capable of handling basic tasks in homes and offices.