In May, Tesla sold 13,863 vehicles in Europe, a year-on-year decline of 27.9%. Of these, sales in the 27 EU countries plummeted by 40.5% to 8,729 units. This information was revealed by the European Automobile Manufacturers’ Association on June 25.
Tesla’s performance in the European market has been in sharp decline, defying the overall market trends. During the same period, Europe sold a total of 1.113 million cars, a 1.9% increase year-on-year. Among these, sales of fully electric vehicles grew by 27.2% to 193,000 units.
Tesla’s European slump can be attributed to several factors, with one key factor being CEO Elon Musk’s deep political involvement during the U.S. presidential election. After Trump’s inauguration, Musk played a significant role in his administration, leading massive government spending cuts. He also frequently commented on European elections and political affairs on social media. Protests were organized by discontented U.S. and European citizens, calling for boycotts of Tesla. Tesla’s persistent low sales in Europe suggest that these actions have had an impact.
At the end of May, Musk concluded his work with the Trump administration after a public fallout between the two. It remains uncertain whether these changes will alter consumer attitudes towards Tesla.
Additionally, Tesla faces stiff competition from Chinese automakers in the European market. According to market research firm Dataforce, in May, Chinese car companies sold over 60,000 vehicles in Europe, a 85% year-on-year increase. The market share of Chinese automakers in Europe reached a record high of 5.4%. Among them, SAIC Motor sold approximately 26,000 vehicles, and BYD sold 13,000 units, very close to Tesla’s sales in the same period. In April, BYD’s European sales surpassed Tesla’s for the first time.
Starting on October 30, 2024, the EU will impose anti-subsidy tariffs on Chinese-made electric vehicles, which will impact Chinese electric car exports. However, Chinese companies have been compensating for this by increasing exports of plug-in hybrid and hybrid vehicles, which are still experiencing significant growth.
Chinese companies are also looking to establish local manufacturing plants in Europe. Chery Automobile’s joint venture in Spain has already begun product deliveries, and BYD’s factory in Hungary is under rapid construction.
The European market serves as a microcosm of Tesla’s global situation. In the first quarter of 2025, Tesla’s global sales fell by 13% year-on-year, and BYD’s sales of fully electric vehicles exceeded Tesla’s for the second consecutive quarter. In April and May, Tesla’s sales continued to decline in both the European and Chinese markets. While there is no official data yet for the U.S. market, the outlook is also not promising.
Tesla had initially hoped to see sales growth rebound in 2025, but the company’s performance across global markets is now under significant pressure.
At the beginning of 2024, Musk led Tesla’s radical shift towards autonomous ride-hailing services (Robotaxi). On June 22, 2025, Tesla launched a small-scale trial of its Robotaxi service in Austin, Texas, with the specially designed autonomous Cybercab planned for mass production in 2026.
While capital markets hold a positive outlook for Tesla’s Robotaxi initiative, the progress of this business remains uncertain, and it will not bring significant revenue to Tesla in the short term. During this new business growth phase, Tesla will need to maintain its vehicle production and sales.
Tesla plans to introduce a new vehicle model in the second half of 2025, priced lower than the Model 3 and Model Y. This new product will play a crucial role in driving Tesla’s sales growth. However, Tesla has not yet disclosed specific details about the new model or its release schedule.