Overall, new vehicle registrations among all brands, including hybrids, show an increase of 8.3 percent growth from this time last year
Sacramento, Calif.—Tesla’s troubles continue to worsen as Californians are giving the cold shoulder to the direct-to-consumer automaker. Registrations show a decline of 15.1 percent through March vs. this time last year.
A year and a half of continuous quarterly declines “proves this downward trajectory” for Tesla is a lasting trend, states the California New Car Dealers Association (CNCDA) in its just-released “Q1 2025 Auto Outlook Report.”
The company’s market share also dropped by 11.6 percent at the end of Q1, now holding less than half of the California Zero Emission Vehicle (ZEV) market for the year.
Data sourced from Experian Automotive.
Tesla’s shrinking sales are “dragging down” the state’s zero-emission vehicle sales momentum. California posted a second quarterly decline in ZEV registrations, holding just 20.8 percent of the market share (down from 22 percent in 2024).
The state’s ZEV market share would need to increase by 14.2 share points to meet the California Air Resources Board’s Advanced Clean Cars II mandated level of 35 percent for 2026 model year vehicles (representing a 68 percent increase in ZEV registrations). The state’s franchised new car and truck dealers begin selling 2026 model year vehicles in a matter of weeks.
“Dealers sell what customers want to buy. No mandate can force consumers to choose otherwise,” said Robb Hernandez, CNCDA’s Chairman and President of Camino Real Chevrolet. “Although the manufacturers we represent are increasing EV sales in California, with the substantial decline in Tesla sales, EV market penetration is largely flat. This puts us well short of EV sales mandates that take effect this year.”
Key Q1 Report Highlights
Overall, new vehicle registrations among all brands showed an increase of 8.3 percent growth from this time last year. More than 463,000 vehicles were registered in the state last quarter, and California’s hybrid market is increasing. Hybrids now hold 17.9 percent of the market share, coming closer to reaching the state’s ZEV numbers.
However, the forecast is cloudy with uncertain predictions for the remainder of 2025; registrations are now expected to dip 2.3 percent to 1.71 million for the full year.
Looming trade policy changes is affecting the outlook. A rush of buying in March and April, likely ahead of anticipated tariffs, may be short-lived if vehicle prices spike.
Brand Market Share and Summary
Among all powertrains and brands, Toyota tops California with 76,625 registrations in Q1, holding 16.5 percent of California’s market share. Honda jumped up a spot this quarter to take 10.8 percent of the market share. And Tesla came in third, with 9.1 share of California’s market, losing 2.6 percent from this time last year.
Toyota also leads California’s light truck market with Ford and Honda in second and third. Several brands that have registrations improving by 30 percent (or more) YTD include Buick, Mitsubishi, Genesis, Chrysler, Cadillac, Land Rover, Nissan and Hyundai.
Model Segment Rankings
California’s best sellers in the primary segments so far in 2025 are the Toyota Camry, Tesla Model 3, Honda Civic, Toyota Tacoma, Ford F-Series, Toyota RAV4, Honda Prologue (which also took third place in the alternative powertrain market), and the Lexus RX.
The top three passenger cars sold this quarter were the Tesla Model 3 (11.6 percent of share), the Toyota Camry (holding 11.5 percent) and the Honda Civic with 10.7 percent of California’s market share.
The top three light trucks sold were the Tesla Model Y (6.8 percent share), the Toyota RAV4 (4.9 percent share), and the Honda CR-V (4 percent share).
Regional Variances
Northern California passenger car sales were up .8 percent, and light trucks were way up with an 8.4 percent increase in registrations. BEVs account for 24.6 percent of Northern California’s market share.
In Southern California, passenger car registrations were down 3.1 percent, while light trucks grew 7.1 percent, with BEVs taking a 23 percent share of the market.
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