Tesla’s electric vehicle (EV) sales have hit a rough patch, with a dramatic decline not only in Europe but now in Canada, particularly in Québec, during the first quarter of 2025. According to a Business Insider report citing data from Québec’s vehicle registration authority, only 524 new Teslas were registered in the province from January to March 2025—a staggering 85% drop from the 5,097 vehicles registered in the final quarter of 2024.
Tesla models that have seen biggest fall in sales — Model Y and Model 3
The Tesla Model Y, the company’s best-selling vehicle, saw registrations plummet to just 360 units in the first quarter of 2025, down from 3,274 in the fourth quarter of 2024 — a decline of nearly 89%. The Model 3, Tesla’s most affordable offering, fared even worse, with registrations falling 94% to a mere 96 units from 1,786 in the previous quarter. These figures highlight a significant setback for Tesla in a key Canadian market.While automotive sales often dip at the start of the year, Quebec’s numbers reflect a far steeper decline than typical seasonal trends. This downturn mirrors Tesla’s struggles in Europe, where sales dropped nearly 50% in April 2025 despite growing overall EV demand, according to Business Insider. The global pattern suggests Tesla may be grappling with broader challenges, including intensified competition from Chinese EV makers like BYD and shifting consumer preferences toward hybrid vehicles.
What hurt Tesla — Rebate freeze, tariffs and …
A major factor in Tesla’s Quebec’s slump appears to be the Canadian government’s sudden suspension of $43 million in federal EV rebates in March 2025. The freeze followed a suspicious surge in Tesla rebate applications, which skyrocketed from 300 to nearly 5,800 per day, prompting a formal review. Business Insider reports that Transport Minister Chrystia Freeland has stated Tesla will remain ineligible for future incentives as long as U.S. President Donald Trump’s 25% tariffs on Canadian goods persist, further complicating Tesla’s market position.Beyond rebates and tariffs, Tesla faces growing competition in Canada from domestic and international EV manufacturers offering more affordable models. For instance, companies like Rivian and VinFast have introduced competitively priced EVs, while legacy automakers like Toyota and Ford are gaining traction with hybrid options. Tesla’s pricing strategy, which has seen multiple cuts in recent years, may also be eroding its brand premium, making it harder to maintain market share in cost-sensitive regions like Québec.
