Tesla’s European car sales fall as customers switch to Chinese EVs

Tesla new car sales in Europe fell for a fifth straight month in May, according to data from the European Automobile Manufacturers Association, or ACEA, as customers pivot to cheaper Chinese electric vehicles.

Data published Wednesday by ACEA found that Tesla’s car sales in the European Union, Britain and the European Free Trade Association fell to 13,863 units in May, down 27.9% year on year.

Tesla’s European market share also dropped to 1.2% from 1.8% in May 2024.

Shares of Tesla fell nearly 5% on Wednesday morning. The stock is down more than 18% year-to-date.

Overall car sales in Europe

The figures reinforce a downward regional trend for the U.S. electric vehicle maker, which has suffered brand and reputational damage in part due to CEO Elon Musk‘s incendiary rhetoric and political activity.

Musk spent nearly $300 million to help elect U.S. President Donald Trump to a second term and subsequently led a tumultuous initiative to slash federal agencies. Protests erupted at Tesla dealerships across Europe in response.

The Tesla CEO has since left the Trump administration, amid a bitter online feud with the U.S. president.

Tesla continues to battle rising competition from traditional automakers, as well as Chinese players. Auto giant BYD, for instance, registered nearly as many vehicles as Tesla in May after outselling Musk’s company for the first time in April.

It had been thought Tesla’s revamped Model Y compact sport utility vehicle could help to deliver a turnaround in the firm’s fortunes — and the SUV was recently found to have been instrumental in delivering a rebound in new car sales in Norway.

Chinese manufacturers maintained their strong momentum in Europe’s new car market in May despite European Union tariffs on Beijing’s EVs.

Chinese automakers sold 65,808 units last month and more than doubled their market share in the region to 5.9%, according to data published Tuesday by JATO Dynamics.

“Despite the EU’s imposition of tariffs on Chinese electric vehicles, its car brands continue to post strong growth across Europe,” Felipe Munoz, global analyst at JATO Dynamics, said in a statement.

“Their momentum is partly due to their decision to push alternative powertrains, such as plug-in hybrids and full hybrids, to the region,” he added.