Tesla’s February sales in Europe took a nosedive, dropping the electric vehicle maker behind traditional automakers like Volkswagen and BMW, as well as rising Chinese competitors. The decline arrives amid increased competition and possible fallout from CEO Elon Musk’s political stances.
Research firm JATO Dynamics reported Tesla’s battery-electric vehicle (BEV) registrations across 25 EU markets plus the UK, Norway, and Switzerland, fell 44% year-over-year. This amounted to fewer than 16,000 cars, resulting on Tesla holding only a 9.6% market share.
Volkswagen’s BEV sales experienced a significant increase, jumping 180% to nearly 20,000 cars. BMW and its Mini brand, combined, sold almost 19,000 EVs. Chinese manufacturers BYD and Polestar also saw substantial growth, recording year-over-year increases of 94% and 84%, respectively.
Political backlash and market shifts weigh on Tesla
Tesla’s European performance decline aligns with increased attention on Elon Musk’s political activity, including his support for former US President Donald Trump and far-right European parties like Germany’s Alternative für Deutschland (AfD).
Felipe Munoz, Global Analyst at JATO Dynamics, stated in a report that Musk’s engagement in politics, increased EV market competition, and the phase-out of the current Model Y have all affected sales.
Polestar CEO Michael Lohscheller acknowledged the shifting customer sentiment, mentioning that his company was targeting Tesla owners unhappy with Musk’s political engagement. Lohscheller shared with Bloomberg, “We get a lot of people writing that they don’t like all this,” and added, “A lot of people have very, very negative sentiment.”
Matthias Schmidt, an automotive analyst based in Germany, told Business Insider that he anticipated Musk’s political activities would affect Tesla’s European sales, with rivals like Polestar benefiting.
Model Y phase-out and growing competition
Tesla faces challenges related to the phase-out of the current Model Y. Munoz observed that brands with limited model lineups, such as Tesla, are more susceptible to registration declines during model transitions.
Traditional automakers and Chinese EV brands are expanding their market presence. BYD, Polestar, Xpeng, and Leapmotor all showed increased sales, indicating a change in consumer preference.
These figures follow Tesla’s poor performance in Europe in January, where sales decreased by almost half. Germany saw the largest drop in Tesla sales, with registrations falling 60% year-over-year to only 1,277 vehicles in January.
