Registrations of Tesla vehicles in California dropped 10% in the last quarter of 2023, the first fall in more than three years in the state, which is one of the most important markets for the electric carmaker and considered a national trend setter.
Nevertheless, Tesla’s Model Y and Model 3 were the No. 1 and No. 2 best-selling vehicles in the California market for all of 2023 by wide margins.
A total of 47,592 Tesla vehicles were registered in California in the fourth quarter, compared with 52,782 a year earlier, according to data from California New Car Dealers Association.
The last time Tesla posted a year-over-year registration fall in California was the third quarter of 2020 during the COVID-19 pandemic. California accounts for about 10% of Tesla’s global deliveries.
CEO Elon Musk has blamed high interest rates for raising monthly payments and in turn hurting demand for his company’s EVs, forcing Tesla to slash prices. Analysts also said Musk may have alienated some buyers with recent actions and comments.
Competition is also growing from traditional automakers, including Chevrolet, Ford, Hyundai , Mercedes-Benz and BMW, which all increased their EV market share in California last year.
During the full year of 2023, Tesla increased vehicle sales by 24.6% but lost market share by 10.5 percentage points to 60.5% of EVs registered in California. Its share of the overall California car and light vehicle market rose slightly to 13%.
In recent months consumers in California have shown increased interest in hybrids and plug-in hybrids. As a result, the market share of new battery-electric vehicles in the state fell to 21.1% in the fourth quarter from 22.3% in the prior three month period.
Reuters contributed to this article.
