Driving the news: Both Tesla $TSLA ( ▼ 4.14% ) and Rivian $RIVN ( ▼ 0.31% ) are struggling with the same problem: demand for expensive EVs is softening without subsidies.
By the numbers: Tesla's Q4 sales dropped 15.6% year-over-year to 418,227 vehicles, missing Wall Street's consensus (422,850 vehicles) and marking the second consecutive year of declining annual sales for the EV maker.
Overall, Tesla sold 1,636,129 vehicles in 2025, down 8.5% from 2024.
Rivian also reported disappointing numbers, delivering 42,247 vehicles in 2025, down 18% year-over-year and slightly below the 42,500 analysts expected.
Why it matters: The end of the federal EV tax credit in September pushed prices up across the industry, slowing demand for higher-priced EVs just as competition intensifies.
Looking ahead: Tesla CEO Elon Musk has said the company faced "a few rough quarters" but believes Tesla will rebound once its AI plans, robotaxis, and humanoid robots come to fruition.
As for Rivian, the company is preparing to launch its lower-cost R2 model in the first half of 2026 to broaden its customer base.
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