Tesla electric vehicle sales jumped last quarter, as buyers rushed to take advantage of an expiring federal tax credit.
The company’s EV sales rose 7% in the three months through September compared to a year earlier, mirroring a spike in overall EV sales across the country.
The $7,500 credit for new electric vehicles was eliminated on Sept. 30 by the Trump administration.
In July, national sales of new EVs jumped 19% compared to a year earlier, according to Cox Automotive. That same month in Orange County, 32% of new vehicles sold were all-electric, up from 21% in May.
The sales boost could mark the start of a rebound for Tesla, which has struggled this year with declining sales and damage to its brand. The quarterly rise marks the first year-over-year sales increase the company has seen in three quarters.
Tesla delivered 497,099 vehicles in the third quarter, up 29% from 384,122 deliveries in the previous quarter. In the same period last year, the company delivered 462,890 vehicles.
The company has faced headwinds, including saturation of the EV market in California and federally imposed auto tariffs that make cars and parts more expensive.
Chief Executive Elon Musk’s foray into politics as head of the Department of Government Efficiency also alienated many potential Tesla buyers and led to boycotts and protests at Tesla dealerships.
Despite the sales increase, Tesla shares were down more than 3% in trading on Thursday. EV sales are expected to fall this month following the tax credit’s expiration.
“This was a great bounceback quarter for Tesla to lay the groundwork for deliveries moving forward, but there is still work to do to gain further ground,” Wedbush analyst and Tesla bull Dan Ives said in a note.
Tesla was not the only brand to benefit from the scramble to buy EVs. Cadillac of Beverly Hills saw a “significant increase” in EV sales over the past few months, according to product specialist Naeim Nastar.
Former Ford executive and digital consultant Adrian Balfour wrote in a note that he was “cautiously optimistic” about Tesla’s turnaround. Tesla deliveries had fallen 13% in the first six months of the year.
“This rebound snaps a rough first half of 2025,” Balfour wrote. “That said, this feels more like a sugar rush than a structural turnaround. The underlying EV market remains choppy.”
Musk has increasingly bet Tesla’s future on its autonomous driving technology and robotaxi venture. Tesla will have to work out kinks with its self-driving efforts to successfully roll out its robotaxis across the country to make that business a real money maker.
Tesla shares have risen 17% so far this year and more than 34% over the past month.
