Tesla's (TSLA.US) annual deliveries experienced a decline for the first time, as demand for its older models faced challenges.

For the first time, Tesla's annual deliveries fell in 2024, despite a record fourth-quarter delivery, as demand for older models weakened.

After opening, Tesla's stock price fell 3%. The year was marked by intensifying competition, the absence of some European subsidies, and weak Chinese consumer spending, which weighed on its deliveries.

Tesla's registrations in Europe fell 24% year-on-year in October, according to JATO Dynamics, a data research company. The Skoda Enyaq SUV from Volkswagen Group performed strongly in the European market, displacing the Model Y as the most popular electric vehicle in the region.

To stimulate demand, Tesla cut prices and offered more incentives, but this also squeezed its car sales margins last year. However, Wall Street analysts expect demand to rebound as the Federal Reserve cuts interest rates in 2025.

Tesla delivered 471,930 Model 3 and Model Y vehicles, as well as 23,640 other vehicles, including the Model S sedan, Cybertruck, and Model X luxury SUV, in the fourth quarter of 2024. Its car production was 459,445 units in the same quarter. In the three months ended December 31, 2024, Tesla delivered a total of 495,570 vehicles, slightly below the 503,269 units forecast by 15 analysts compiled by LSEG.

On a full-year basis, Tesla's total deliveries in 2024 were 1.79 million, down 1.1% year-on-year, below the 1.806 million forecast by 19 analysts compiled by LSEG.