(Reuters) – Tesla on Wednesday reported third-quarter vehicle deliveries below estimates as incentives and low-cost financing failed to lift demand for its aging models in a highly competitive market.

Shares of the world’s most valuable automaker fell 2.5% in premarket trading.

Rising competition in the United States, a lack of European subsidies and slowing consumer spending in China weighed on Tesla’s quarterly deliveries.

In July, BMW led the European battery electric vehicle (BEV) market for the first time, beating Tesla, which has been losing market share to domestic firms, according to a report by JATO Dynamics.

The price cuts and incentives have also squeezed the company’s profit margins.

The EV maker handed over 462,890 vehicles in the three months to Sept. 30, up 6.4% from the preceding quarter.

Wall Street on average had expected the Elon Musk-led company to deliver 469,828 vehicles, according to 12 analysts polled by LSEG.

The company has to deliver 516,344 more vehicles in the fourth quarter to meet last year’s delivery figure of 1.81 million units.

(Reporting by Akash Sriram in Bengaluru; Editing by Anil D’Silva)