Tesla’s California Sales Slide Deepens as Hybrids Displace EVs

Tesla Inc. saw a steep drop in vehicle registrations in California as consumers in the Golden State increasingly embrace hybrid vehicles.

Tesla’s first-quarter registrations declined 24% in the state compared with the prior-year period, according to a report released Tuesday by the California New Car Dealers Association.

The drop continued a broader retreat by EVs in California, where zero-emission vehicles accounted for less than 14% of all new vehicles registered during the most recent quarter. By contrast, gas-electric hybrids grew to account for about 21% of the market, according to the dealer association, citing data from Experian Automotive.

Tesla’s Model Y remains the top-selling vehicle in the state of any kind, followed by the Toyota Camry, which is a hybrid. As federal incentives for EVs have been cut back, Governor Gavin Newsom has tried to fill the void with $200 million in state subsidies.

Top photo: Tesla Inc. electric vehicles (EV) in San Francisco. Photographer: David Paul Morris/Bloomberg.