Tesla’s grip on the U.S. electric vehicle market is slipping faster than many expected. New registration estimates suggest the automaker opened 2026 with a sharp sales decline, continuing a streak of weakening demand and putting even more pressure on its once-dominant position in the EV space.
US Sales Hit a Four-Year Low
Tesla
According to registration estimates from Motor Intelligence, Tesla sold roughly 40,100 vehicles in the US in January 2026. That’s roughly 17% lower than the same month last year and marks the fourth straight month of year-over-year declines, after Tesla hit its lowest point in four years in December 2025. Interestingly, 72% of its January 2026 sales were Cybertrucks – a model that saw a 48.1% year-over-year decline in 2025. On a full-year basis, Motor Intelligence estimates Tesla registered around 568,000 vehicles in the US in 2025, roughly 10% fewer than in 2024.
Higher Prices Are Killing The EV Market
Although Elon Musk’s alleged ties to Jeffrey Epstein and all his other ‘controversial choices’ play a part in Tesla’s decline, there’s more to the story. The expiration of the $7,500 federal EV tax credit in late 2025 effectively pushed prices higher across the board for all EVs, and buyers responded by pulling back. EV sales in America dipped for the first time in years, with January volumes estimated to be nearly 30% lower than a year earlier. According to a Deloitte study, just 7% of US car buyers would buy an EV as their next car. Automakers, Tesla included, have tried to soften the blow by introducing cheaper trims to offset price hikes, but those strategies have yet to bear fruit. So far, that strategy hasn’t been enough to reverse the broader slowdown in demand.
Tesla’s Dominance Is Starting to Crack
There are still areas where Tesla dominates. The Model Y remained the best-selling new vehicle in California for the fourth straight year in 2025, outselling even the Toyota RAV4 – the best-selling car in the US. But even there, Tesla’s overall sales continue to slide, falling from 202,865 units in 2024 to 179,656 in 2025. Beyond the US, competition is heating up fast. BYD has overtaken Tesla as the world’s largest EV seller, despite not existing in large markets like the US. At the same time, Tesla just discontinued the Model S and Model X as a result of a decline in sales. Put together, January’s 17% U.S. decline looks less like a short-term dip and more like part of a once-revealed automaker eroding.
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