Tesla’s sales in China were down 30% to 38,588 vehicles in May compared with the same month a year earlier, according to new data from China Passenger Car Association reported by China EV blog CnEVPost. Out of the five months reported this year, four saw year-on-year declines. From January through May, Tesla sales were down about 8% in China compared with the same period in 2024. Analysts expect sales in China to decline for the full year, which would be its first year-over-year decline there.
As JPMorgan analyst Ryan Brinkman said on a webinar about the state of the auto industry late last month, CEO Elon Musk isn’t facing the same level of political blowback in China as he is in the US and Europe.
“We know [sales are] down in North America, we know they’re down in Europe because he’s upset half the population in the US and 95% of the population in Europe,” Brinkman said. “Musk remains a popular person in China.”
Rather, the company’s problems in China have more to do with competition from rivals like BYD.
“They’re down in China because the competition is ferocious,” Brinkman said. “They’re competing on price, but they’re also competing on design and technology and refresh rates because they’re coming out with new models every two years, whereas Tesla has never introduced a new model in China.”
Brinkman added that autonomous driving is table stakes in China: “They’re giving away autonomy for free.”
However, even without Musk’s political machinations it’s possible Tesla is facing a political branding problem in China, too.
As an independent analyst who goes by Troy Teslike recently wrote, Tesla, like all American brands in China, is facing “political tensions following U.S. Vice President JD Vance’s remarks, which many in China saw as disrespectful.” In April, Vance went on Fox News to talk about tariffs and said, “We borrow money from Chinese peasants to buy the things those Chinese peasants manufacture.”
