Musk's Comeback Hasn't Saved Tesla Yet: Europe Sales Slide for 5th Straight Month Amid Intensified Competition

Tesla’s rough patch in Europe deepened in May, marking the fifth straight monthly decline for the U.S. electric-vehicle pioneer even as the region’s broader EV market accelerates.

Data released by the European Automobile Manufacturers’ Association (ACEA) show Tesla registrations tumbling 27.9 % year-on-year to 13,863 units, while some industry tallies put the drop at more than 40 %. Either way, the retreat stands in sharp contrast to the 1.9 % rise in overall car sales across the European Union, United Kingdom and European Free Trade Association countries.

For the first five months of 2025, Tesla has sold 75,196 vehicles in the region—down roughly 37 % from a year earlier—pushing its market share to barely 1.2 % versus 1.8 % in 2024. The revised Model Y, intended to freshen an ageing lineup, has yet to arrest the slide.

The pain comes despite a buoyant electric-car backdrop. Battery-electric registrations in Europe jumped 26.1 % year-to-date to more than 700,000 units, seizing 15.4 % of the total market, while hybrids and plug-in hybrids also notched double-digit gains. Chinese state-owned SAIC boosted registrations 22.5 percent last month, and privately held BYD continues to flood showrooms with aggressively priced models, underscoring the intensity of new competition.

Price pressure is not Tesla’s only headache. Industry analysts say some European buyers are shunning the brand over CEO Elon Musk’s high-profile political positions and perceived alignment with U.S. president Donald Trump. Meanwhile, traditional automakers are rolling out fresh EVs at break-neck speed, often equipped with local incentives and familiar dealer networks.

There are bright spots. In Norway—where EV subsidies remain generous—Tesla deliveries surged more than 200 % in May, and the Model Y regained its best-seller status. Yet weakness in Germany, France and Italy outweighed that Nordic strength; Spain was the lone major EU market to post a double-digit gain in overall car demand.

Europe’s policy goal of ending internal-combustion sales by 2035 keeps the long-term opportunity intact, but the latest figures underscore how quickly the competitive landscape is shifting. To regain momentum, Tesla will need more than minor facelifts—sharper pricing, a broader product portfolio and renewed consumer goodwill are likely prerequisites for a sustainable comeback on the continent.