Electric vehicle maker Tesla announced on Friday that its sales in China increased by 8.8% in 2024, reaching a record high of more than 657,000 vehicles.
This strong performance in China comes at a time when Tesla’s global deliveries saw their first-ever decline, reflecting challenges in other markets.
Tesla’s sales in the world’s largest auto market also saw a notable surge in December, rising 12.8% month-on-month to a record 83,000 units, according to Tesla China.
In 2024, Tesla delivered 36.7% of its cars to customers in China, making it the company’s second-largest market by sales. However, the company’s global deliveries fell by 1.1%, missing CEO Elon Musk’s earlier forecast of slight growth.
Exports from China also suffered a significant 24% drop, partly due to reduced European subsidies, increased competition from Chinese rivals like BYD, and a shift in the U.S. market toward lower-priced hybrid vehicles.
Tesla’s China-made EVs, including exports to Europe and other markets, saw a slight 0.4% dip in December compared to the previous year, with 93,766 units sold, according to data from the China Passenger Car Association.
This marks Tesla’s first annual decline in deliveries from its Shanghai factory. Full-year sales of China-made Model 3 and Model Y vehicles, including both domestic sales and exports, dropped by 3.3%. Exports from China fell to approximately 260,000 units, the lowest since 2021, according to Reuters calculations.
Tesla’s exports to Europe were further impacted by a year-long European Commission investigation into Chinese-made EVs, which culminated in a 7.8% tariff imposed on Tesla vehicles from China in October.
The carmaker’s record China sales, despite a global sales slump, reflect the current state of the global EV market. China remains the only major market experiencing robust growth, while other regions are seeing slowdowns or declines. According to industry data, China accounted for 70% of global sales of EVs and hybrids in the first 11 months of 2024, contributing to more than 90% of the global increase in EV and hybrid sales from the previous year.
Tesla’s global sales in 2024 reached 1.79 million cars, narrowly outpacing BYD, which reported a 12.1% increase in EV sales, reaching 1.76 million units globally.
Amid declining demand and stiffening competition from Chinese EV manufacturers, Tesla made strategic adjustments, including downsizing its global workforce and reducing its China sales team.
The company also extended discounts on its popular Model Y, offering up to a 10,000 yuan ($1,369.99) reduction on outstanding loans and zero-interest financing on some Model 3 and Model Y cars through the end of January 2025.
BYD, a dominant player in China’s EV market, led a price-cutting competition with its Dynasty and Ocean series of EVs and plug-in hybrids. BYD surpassed its sales target, increasing its passenger vehicle sales by 41%, totaling over 4.25 million units in 2024. The Chinese EV giant’s overseas shipments rose 71.9% to 417,204 units, or 9.8% of its global sales.
However, it fell short of its 2024 export target of 450,000 units, partly due to a 17% tariff on its EVs imposed by the European Union. Despite this, Brazil emerged as a significant market for BYD, accounting for nearly one in five of the company’s exports.
Meanwhile, BYD and its contractor, Jinjiang Group, are facing investigations in Brazil over the conditions of Chinese workers at a local BYD factory construction site.
