Sales of Tesla’s China-made electric vehicles fell 15% year-on-year in May, with 61,662 Model 3 and Model Y units delivered, including domestic sales and exports to Europe and other countries, according to the China Passenger Car Association. In April, the decline was 6%.

Compared to April, deliveries increased by 5.5%.

In Europe, Tesla also faced weaker demand due to its aging model lineup and CEO Elon Musk’s political activities, which deter some buyers.

To support sales in China — the company’s largest market in the first quarter — Tesla offered free transfers of its smart assisted driving feature to new vehicles until the end of June. This year, Model 3 and Model Y were also included for the first time in China’s government program to promote electric vehicles in rural areas.

The company continues to face fierce price competition. The price war initiated by Tesla in 2023 has involved over 40 brands and continues to this day. New affordable yet high-performance models entering the market are putting additional pressure on Tesla’s sales.

Chinese authorities have called for an end to price wars after BYD offered discounts on more than 20 models in late May, prompting Geely Auto and Chery to follow suit.

In May, BYD’s passenger vehicle sales rose 14.1% year-on-year to 376,930 units, slowing from April’s 19.4% growth.