Tesla Faces Challenges as EV Deliveries Decline and Market Competition Grows

Tesla reported a decline in yearly deliveries as incentives failed to attract customers facing high borrowing costs. Competition, particularly from China's BYD, and reduced subsidies hurt Tesla. Despite strong sales in China, concerns about market saturation prompt Musk to focus on self-driving technology and new models like the Cybertruck.

Tesla recorded its first decline in annual deliveries, despite offering year-end incentives, as high borrowing costs deterred customers. The incentives, including interest-free financing and free fast-charging, couldn't boost sales as hoped.

Factors like reduced European subsidies, shifting preferences towards hybrid vehicles in the U.S., and rising competition, especially from China's BYD, contributed to Tesla's challenges. BYD's aggressive pricing and market expansion helped it increase battery-electric vehicle sales by 12.1%, surpassing Tesla's growth.

Amid slowing EV demand, Tesla is focusing on developing a self-driving taxi business, although commercialization is years away. Tesla also aims to boost sales with cheaper versions of current models and the Cybertruck. Despite optimistic sales forecasts, doubts linger over meeting targets due to sluggish demand for the Cybertruck.

(With inputs from agencies.)