--- title: "Tesla Is in Serious Trouble in China" description: "Tesla's market share in China is shrinking, which could represent yet another nail in Elon Musk's carmaker's coffin." date: "2025-07-10" modified: "2025-07-10" authors: - name: "Victor Tangermann" job_title: "Senior Editor" link: "https://futurism.com/authors/victor" url: "https://futurism.com/tesla-serious-trouble-china" categories: - "Advanced Transport" - "Tesla" tags: - "BYD" - "china" - "elon musk" - "evs" - "tesla" --- # Tesla Is in Serious Trouble in China ![Tesla's market share in China is shrinking, which could represent yet another nail in Elon Musk's carmaker's coffin.]() *\Image: Kevin Frayer/Getty Images\* As its sales continue to [crater]() in the US and Europe, Tesla's reliance on China — its second-largest market and biggest production hub — is growing. But thanks to a surge in far more price-competitive and lucrative offerings from Chinese EV manufacturers like BYD, Tesla's woes look poised to metastasize there as well. Its market share in China is shrinking, the [*Wall Street Journal* reports](), which could represent yet another nail in Elon Musk's carmaker's coffin. The company sold 40,000 fewer cars in China in May, a massive 30 percent drop from the same month last year, a familiar story that's been playing out in many other parts of the world. Then there's Musk's highly damaging embrace of far-right ideologies, which have iced over the brand's popularity in huge swaths of the world. "Tesla remains important for China," a consultant for Chinese officials told the *WSJ*. "But for authorities, helping domestic companies still matters more." While "you never want to bet against Elon Musk and the resilience of Tesla," Musk is "probably closer to sunset than sun up in his business in China," former General Motors exec Michael Dunne added. Tesla could soon end up suffering the same fate as many other American tech companies, including Motorola and Apple, which once enjoyed enormous success in China — only to be lapped by better tech and domestically oriented regulations. "Teslas are almost like iPhones now," 34-year-old Qian Yang, who sold his Tesla Model 3 in favor of a Xiaomi SU7 EV, told the *WSJ*. "They’re getting uninspired and stale, and don’t have revolutionary features anymore." Tesla has also been facing [steep regulatory hurdles]() getting its controversial and misleadingly-named "Full Self-Driving" driver assistance software approved in China. Beijing has yet to issue full approval, giving Chinese companies more time to catch up. However, that hasn't stopped the Musk-led company from rolling out the software anyway, per the *WSJ*, which has angered officials there. Musk has also reportedly ditched plans for a new car design that would be more amenable to Chinese consumers, instead focusing the company's efforts on cutting corners to save costs. The trend couldn't come at a worse time for Tesla, which has been [feeling the hurt]() under Musk's absentee leadership. His most recent promise to create a third US political party — months after promising he was done with politics for good — has [spooked investors](), wiping out tens of billions of dollars in market cap. To experts, Musk simply [didn't play his cards right](), failing to predict Tesla could easily be overlapped in its second most important market. Even the company's Optimus humanoid robot — which Musk [sees as Tesla's future]() alongside robotaxis — already has [some intense competition]() in China, despite being many years from hitting markets. "He made the same mistake that every foreign automaker made — to underestimate China’s ability to out-innovate you," China-based strategy firm Automobility CEO Bill Russo told the *WSJ*. **More on Tesla:** *[Musk Is Struggling to Understand What's Happening Around Him, Says Former Tesla Exec]()* ## Author I've been at Futurism since 2017, where my role has evolved to encompass design, writing, and increasingly editing. I've always been fascinated by space exploration and advanced transportation, which I've leaned into by interviewing luminaries in those fields while closely following the dimensions of policy and regulation that allow next-generation projects to succeed -- or, sometimes, to fail. I'm also keenly interested in the effects of generative AI on society, policies, and democratic institutions, as well as clean energy, physics and biology, and the vagaries of tech leadership. My work for Futurism has been cited by publications including Ars Technica, Gizmodo, PC Magazine, Jalopnik, Fox News, and the New York Post. I spent my childhood living in locations including Manila, the Philippines, and Geneva, Switzerland, attended McGill University, and now live in Toronto, Canada. Before Futurism I worked at AskMen and a small photography studio. In my free time, I'm an avid gardener, foodie, and craft beer lover, as well as a maker of artisanal hot pepper sauces. I have a magnificent dog named Freida. ### Author social links [Bluesky]()