Tesla Inc (NASDAQ:TSLA) saw its European sales and market share plunge sharply in July, data from the European Automobile Manufacturers’ Association (ACEA) revealed Thursday, even as overall electric vehicle adoption in the region continued to climb.
Chinese automaker BYD Co (USOTC:BYDDY), included in ACEA’s monthly sales data for the first time, surpassed Tesla, capturing a larger portion of the market.
According to ACEA, Tesla’s total new car registrations in the European Union, the Europe Free Trade Association, and the UK fell 40.2% year-on-year to 8,837 units. ACEA, representing 15 European carmakers, acts as the principal lobbying and standards organization for the region’s automotive industry.
Tesla’s share of the European market slipped to 0.8% from 1.4% last year, with cumulative sales from January to July dropping 33.6% compared with the same period in 2024.
The decline occurred despite total battery electric vehicle (BEV) sales in Europe rising 33.6% in July. BEVs now make up about 15.6% of the market, behind petrol vehicles at 28.3% and hybrids at 34.7%.
July’s numbers highlighted Tesla’s ongoing difficulties in Europe amid growing competition from both local and Chinese manufacturers. BYD sold 13,503 units during the month, surpassing Tesla’s market share at 1.2%. The popularity of BYD’s hybrid models among cost-conscious buyers, combined with limited impact from high European import tariffs on Chinese vehicles, helped its sales performance.
Tesla’s updated Model Y, launched earlier this year, had minimal effect on boosting sales, while rival European EV models, developed over recent years, further intensified competition.
Tesla’s reputation in Europe has faced headwinds, impacted by CEO Elon Musk’s public support for U.S. President Donald Trump and his ties to a German far-right party, which prompted consumer boycotts across Europe and the United States.
Musk, during Tesla’s second-quarter earnings call in late July, said the company is facing “a few rough quarters,” with the elimination of U.S. EV tax credits adding pressure.
Nonetheless, Musk highlighted the company’s long-term growth priorities, identifying artificial intelligence, autonomous driving, and robotics as future drivers for Tesla.
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