Tesla Inc. (TSLA) is having a rough stretch in its home market. The electric vehicle maker sold just 39,800 vehicles in the US during November, down 23% from the 51,513 units it moved in the same month last year, according to Reuters. It's Tesla's weakest monthly performance since January 2022.

Market Share Up, But the Wrong Way

Here's where things get interesting. Tesla's share of the US EV market actually surged to over 56.7% from 43.1%. Before you break out the champagne, though, understand what's happening: this isn't because Tesla is crushing it. Legacy automakers are scaling back their EV efforts, shrinking the overall pie. Tesla is getting a bigger slice of a smaller cake.

The company is pulling out promotional tactics that suggest demand isn't exactly robust. Tesla is now offering 0% financing on its models, which expert Shawn Campbell points out wouldn't be necessary if customers were lining up. His prescription? Tesla needs to introduce "new, fresh models" rather than relying on discounts to move existing inventory.

Cheaper Models Enter the Picture

Tesla is trying to address affordability concerns with stripped-down versions of its core lineup. The company recently launched "Standard" trims of the Model 3 and Model Y, priced at $36,990 and $39,990 respectively. These entry-level options aim to attract price-conscious buyers, but the sales figures suggest there's more work to do.

The weakness isn't confined to American shores. Tesla's European sales in October fell 48.5% year-over-year, dropping to just 6,964 new registrations from 13,519 units the previous October.

The Broader EV Slowdown

Tesla isn't suffering alone. Ford Motor Co. (F) saw its EV sales plummet 60% in November, with the F-150 Lightning electric pickup taking a particularly brutal 72% hit during the month. The entire EV sector is feeling the chill.

Policy Headwinds From Washington

Part of the sales slump stems from shifting political winds. The Trump administration has relaxed Corporate Average Fuel Economy (CAFE) standards, emphasizing vehicle affordability over emissions reduction. Transportation Secretary Sean Duffy has been vocal in criticizing what he called the Biden administration's "backdoor EV mandate," referring to policies implemented under former Transportation Secretary Pete Buttigieg.

This policy reversal creates uncertainty for EV buyers and gives traditional automakers breathing room to slow their electric transitions. For Tesla, which builds only electric vehicles, there's no pivoting back to gas engines when the regulatory environment shifts.

Price Action: TSLA shares declined 0.80% to $446 during after-hours trading, according to market data.