Tesla (TSLA) sees US market share of electric car sales drop to new lows

Tesla (TSLA) is seeing its US market share of the electric vehicle market drop to new lows in August, according to data from Cox Automotive, a research firm.

It’s happening amid a surge in EV sales in the US, following the expiration of the federal tax credit.

Tesla’s global sales have been in decline since a peak in 2023.

After declining slightly by 1% in 2024, Tesla’s sales are down roughly 10% globally in 2025.

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The American automaker’s sales in Europe are down by as much as 40% and in China, the world’s largest EV market, Tesla is down about 6%.

Only in its home market, the US, Tesla appears to be able to maintain its sales level, but that’s not expected to last.

EV sales are expected to reach a record high in Q3 2025 in the US, driven by the end of the $7,500 tax credit for electric vehicles, which will expire on September 30th. It is driving demand forward into Q3, and sales are subsequently expected to crash in Q4.

Every electric automaker is competing for the strong demand ahead of the end of the tax credit, and new data suggests that Tesla may be losing market share in the process.

According to new data from Cox Automotive, Tesla’s market share in the US was down to 38% in August (via Reuters):

Tesla, which once held more than 80% of the U.S. EV market, accounted for 38% of the total EV sales in the United States in August, the first time it has fallen below the 40% mark since October 2017, when it was ramping up production of the Model 3, its first mass market car, according to early data from Cox.

While it has been a while since Tesla dominated the US EV market with an 80% market share, the Texas-based automaker has maintained a 50%+ market share for an impressive number of years.

Tesla only started to lose its hold on the US market in 2025. The automaker’s market share in the US has been in a steady decline throughout the year.

By June, Tesla’s market share dipped below 50% to 48.7%, according to Cox’s data. Since then, it has been in a free fall, dropping to 42% in July and now to 38% in August.

Electrek’s Take

I always expected Tesla’s market share to drop over time as more EVs became available from legacy automakers and new entrants.

But I didn’t expect, or at least until the last 2 years, that Tesla’s global deliveries would decline during that time.

I thought that Tesla would continue to grow with the rest of the EV market, just with a smaller percentage of the market as the pie gets bigger.

However, that’s not what’s happening. Tesla’s deliveries are declining while the global EV market continues to surge.

Meanwhile, even in the US, Tesla’s market share is plummeting.

That’s what happened when you have a minimal and aging vehicle lineup facing increasingly intense competition, and your CEO is one of the most disliked men in the world.

Now, I know that the CEO and Tesla shareholders will say that it doesn’t matter because Tesla is somehow magically an AI and robotics company, despite almost all of its profits coming from the sale of vehicles.

The funny thing is that Tesla will end up having a strong Q3 because of the demand being pulled forward in the US, and I bet they will celebrate this even though it’s going to be purely because of the auto business and probably the last good quarter its auto business will have for a long time.