Tesla reported weaker-than-expected global deliveries in the first quarter, with 358,023 vehicles delivered, up just 6% year-over-year. The electric carmaker fell short of analyst forecasts of 365,000 units, sending shares down 4% in pre-market trading. After losing its crown as the world's largest EV maker to China's BYD last year, Tesla has seen its fortunes reverse as BYD's sales tumbled 25% amid fierce competition and the end of Chinese government subsidies.

Tesla's European market has shown signs of recovery with new registrations rising 12% in February, with March showing even stronger performance in countries like France. The rebound was driven by cheaper versions of its Model Y and Model 3, along with cash discounts in some markets. HSBC analysts noted the discount strategy helped regain market share against Chinese rivals who had gained ground during Tesla's pricing challenges.

As CEO Elon Musk pivots the company toward self-driving robotaxis and AI, analysts project only modest growth in Tesla's EV sales this year to 1.69 million units, up from 1.64 million in 2025. Tesla will discontinue its premium S and X models next quarter while facing continued pressure from the expiration of US EV tax credits. Rising fuel costs from the Middle East conflict could provide a temporary boost to EV demand for Tesla.