Tesla Faces Challenges Amid Decline in EV Deliveries and Changing Political Landscape

Tesla reported a decline in yearly deliveries due to competition, reduced subsidies, and high borrowing costs. Despite efforts like interest-free financing, demand slowed. Musk pivots toward self-driving taxis and supports President-elect Trump for regulatory easing. Tesla grapples with waning demand and political changes impacting EV sales.

Tesla announced its yearly vehicle deliveries have declined for the first time, as the company faces challenges from reduced European subsidies and increased competition, particularly from China's BYD. Analysts noted that the incentives Musk presented, such as interest-free financing, failed to attract enough buyers amidst high borrowing costs.

With these challenges in mind, Elon Musk is refocusing efforts on developing a self-driving taxi business, which he believes could significantly enhance Tesla's market value. Additionally, Musk has aligned with the incoming Trump administration, hoping for regulatory changes that could benefit the company.

Analysts urge that Tesla still relies on the success of the new Cybertruck and other upcoming, cheaper models to meet its ambitious growth targets. Meanwhile, Tesla is under scrutiny from both the law and competitors, as some policies under Trump's team might impact the electric vehicle market further.

(With inputs from agencies.)