Expiring EV Tax Credit Boosted Tesla Sales Significantly, Yet Its Flagship Models Experienced a Decline | Carscoops
Tesla's sales saw a rebound in Q3 as buyers hurried to purchase before the expiration of tax credits, but the company faces greater challenges moving forward.
The automaker delivered 497,099 vehicles, an increase from 462,890 units last year. Deliveries surged by 29.4% compared to Q2 due to strong demand for the Model 3 and Model Y.
Although Tesla has had a difficult year, the good news is that third quarter deliveries rose by 7.4% year-over-year, attributed in part to the recently expired clean vehicle tax credit driving consumers to showrooms.
Specifically, Tesla delivered 481,166 units of the Model 3 and Model Y in the third quarter, up from 439,975 last year, marking a 9.4% increase.
However, the situation isn't entirely positive, as deliveries of the Model S, Model X, and Cybertruck have continued to stagnate, falling from 22,915 units last year to 15,933 this quarter.
Overall, Tesla produced 447,450 vehicles and delivered 497,099. In the previous year, the company manufactured 469,796 EVs and delivered 462,890.
Examining the details, Tesla's sales have significantly recovered since Elon Musk's controversial political comments alienated some consumers. Compared to the previous quarter, deliveries experienced a notable increase of 29.4%, primarily driven by the Model 3 and Model Y, which rose by 107,438 units. Deliveries of "other models" also expanded by 53.3%, with 15,933 units delivered.
However, the sales surge is likely over now that the tax credit has ended. Customers will need to pay at least $42,490 for a Model 3 or $44,990 for a Model Y, which may reduce their attractiveness. The company is attempting to address this with a more affordable Model Y.
Notably, Tesla isn't the only automaker focusing on budget-friendly EVs; Hyundai has recently reduced prices for the 2026 Ioniq 5, which starts at $35,000—$7,600 less than the previous year's model. Other trims have even larger price cuts, averaging $9,155.
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Expiring EV Tax Credit Boosted Tesla Sales Significantly, Yet Its Flagship Models Experienced a Decline | Carscoops
Tesla's sales recovered in Q3 as customers hurried to purchase before tax credits ended, but the company is now confronted with more challenges moving forward.