Struggles persist for Tesla in Europe as sales drop in Germany and the UK during the month of May.
Tesla, once a dominant player in the electric vehicle (EV) market, is experiencing a significant sales slump in Europe. The downturn is particularly noticeable in Germany and the UK, with Tesla's registrations plunging by 77% in Germany compared to May 2024, and UK sales dropping by 60% in July 2025 versus July 2024[1].
The slump in Tesla's European sales can be attributed to several factors. Rapidly increasing competition from European and local EV manufacturers offering more affordable and up-to-date models is eroding Tesla’s market share[2]. Additionally, Tesla's vehicle lineup is aging without sufficient refreshes or new competitive models, making it less appealing to consumers in 2025[2].
Elon Musk's controversial public image and associated polarization have also alienated some European consumers, adversely affecting brand perception and sales[2]. Earlier supply constraints due to Model Y changeover in production were initially cited as a reason for the slump, but analysts have since dismissed them as the main reason, given the ongoing acceleration in the sales decline through 2025[1].
Chinese EV makers are making significant strides in Europe, with BYD's registrations soaring ninefold to 1,857 units in May 2025, surpassing Tesla's total[1]. Even Chinese automaker BYD posted strong gains, doubling its UK sales to 1,388 units in May 2025[1].
The downturn in Tesla's sales raises questions about the future of Giga Berlin, the factory designed for 500,000 vehicles annually and planned to expand to 1 million cars per year[1]. At the current pace, Tesla may struggle to produce and sell even a quarter of Giga Berlin's capacity in 2025[1].
Despite the decline, Tesla remains the best-selling EV brand in the UK year-to-date[1]. Tesla's referral link offers three months of Full Self-Driving (FSD) for those buying a Tesla and enjoying the content that helped in their decision.
BEV sales in the UK increased by 28% overall in May 2025, while the overall BEV market in Germany saw a nearly 45% year-over-year rise in May 2025[1]. This growth in the EV market indicates a positive trend for the industry, despite Tesla's current challenges.
[1] New AutoMotive [2] Reuters [3] Bloomberg [4] Tesmanian [5] InsideEVs
- The rise of Chinese EV manufacturers, such as BYD, presenting more affordable and modern models, is adding to the challenges Tesla faces in the European market.
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