Tesla market share falls to 9.9% in California; Toyota grows

Tesla’s Market Share in California Plummets in 2025, Clearing Path for Asian Rival’s Growth

  • Tesla registrations in California fell to 179,656 in 2025, down from 202,865 the prior year.
  • Tesla market share dropped to 9.9% from 11.6%, placing it behind Asian brands like Toyota and Honda.
  • Overall EV registrations in California declined to 20.9% of the market, down from 22%, the first year-over-year drop since 2020.
  • Toyota remained the top-selling brand with 322,068 registrations, an 11.6% increase; Lexus rose 4.8% to 65,623 units.
  • Lucid saw registrations jump 58.7% to 3,910 units, nudging its market share to 0.2%.

According to published data, registrations for Tesla vehicles in California fell to 179,656 in 2025 from 202,865 in 2024, reducing the company’s state market share to 9.9% from 11.6%. The decline left Tesla behind Asian automakers such as Toyota and Honda in statewide brand rankings.

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Other electric vehicle makers also lost ground but not as sharply in share. Registrations for Polestar fell 42%, and Rivian declined 7.5%, while Lucid increased registrations 58.7% to 3,910 units, lifting its market share to 0.2%.

EVs made up 20.9% of California’s light-vehicle market in 2025, down from 22% in 2024 — the first yearly drop since 2020. Despite the slide in EV share, the Model Y and Model 3 remained among the state’s best-selling vehicles, with the Model Y the top-selling EV in 2025.

Across all fuel types, Toyota was the best-selling brand with 322,068 registrations, an 11.6% increase that raised its market share to 17.8%. Lexus registrations rose 4.8% to 65,623 units.

Overall light-vehicle registrations rose 3.3% from 2024 to 2025, but the dealer association projects a 1.5% drop in 2026 as transaction prices approach $50,000. “Additionally, tariffs will almost certainly lead to rising vehicle prices, the labor market is weakening, and household incomes are barely keeping pace with inflation,” the association said.

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Retail investor sentiment on social platforms showed bullish interest in Tesla and Lucid, while sentiment for Toyota and Rivian was neutral. Over the past 12 months, Tesla shares rose about 8% and Toyota shares about 22%.

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