Tesla launched its more affordable Model Y and Model 3 in October last year, but the move hasn't significantly boosted overall sales. First-quarter figures show deliveries of just 358,023 vehicles globally, well below analysts' expectations.

The company produced 408,386 vehicles during this period, marking a mere 6% increase over Q1 2025 — the firm’s worst quarter in years. This trend could see Tesla experience its third consecutive year of declining sales, as profits also take a hit.

Other EV manufacturers are also struggling to meet expectations. Rivian shipped around 10,000 vehicles in Q1, with no immediate improvements on the horizon. Meanwhile, Tesla’s Cybertruck outsells other models but still falls short of Musk's ambitious forecasts.

Tesla is currently without a new mass-market vehicle, as the project for a $25,000 car was scrapped in favour of developing stripped-down versions of existing models. The company now relies on its Cybertruck and legacy vehicles to keep sales afloat.