Sunita Somvanshi
Tesla’s grip on the European electric vehicle market is weakening rapidly. Recent figures show Tesla deliveries plummeted 43% in February 2025 compared to the previous year, even as the overall European EV market grew by 28%.
The decline isn’t just a minor setback. In the first two months of 2025, Tesla sold only 26,619 vehicles in European markets, down 42.6% from the 46,343 delivered during the same period in 2024, according to the European Automobile Manufacturers Association (ACEA).
“Tesla had the worst performance of all automakers in the market,” notes Fred Lambert of Electrek, highlighting just how significant this sales slump has become.
Competition Intensifies from All Sides
Traditional European manufacturers and Chinese brands are closing in fast. Volkswagen’s ID series, Mercedes-Benz’s EQ range, and BMW’s i series are directly targeting Tesla’s Model 3 and Model Y. Meanwhile, Chinese manufacturers like BYD are entering with affordable alternatives that often undercut Tesla‘s prices.
BYD has even overtaken Tesla in global annual revenue for 2024, despite facing EU and US tariffs on Chinese-made EVs.
Why Is Tesla Struggling?
Several factors explain Tesla’s European difficulties:
Limited Model Range: Tesla relies heavily on just two models – the Model 3 and Model Y – while competitors offer various body styles and features for different consumer preferences.
Price Competition: European and Chinese automakers are offering similar or better features at lower prices, challenging Tesla’s premium pricing strategy.
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Consumer Preferences: European buyers often prefer smaller cars, hatchbacks, and station wagons – styles Tesla doesn’t currently offer.
Local Production: European automakers are increasing local EV production, reducing costs and aligning with EU preferences for domestically manufactured vehicles.
The Musk Factor
Industry observers point to another significant issue: Elon Musk’s political activities. His public support for right-wing political parties, particularly in Germany, appears to be affecting sales.
Musk’s political engagement has contributed to Tesla’s sales decline. This includes his public statements during Germany’s political events.
Tesla’s sales in Germany were significantly lower in February 2025, as reported in the source documents.
Ahmad Assiri, research strategist at Pepperstone, noted: “Musk’s political engagement has triggered a significant backlash, notably evident through explicit calls for boycotts, negatively impacting Tesla’s reputation among substantial segments of consumers and investors.”
Market Share Outlook
Tesla’s struggles aren’t just temporary disruptions. The company is already down 20,000 units in Europe for the first two months of the year compared to 2024, and that gap could grow to 30,000 by the end of the quarter.
In key markets like Sweden, Tesla delivered 655 cars in March 2025 so far, compared to 2,524 for the entire month of March 2024. Norway shows a similar trend with 1,444 deliveries versus 2,334 for the previous March.
Meanwhile, battery-electric vehicles now account for 17% of the entire European auto market, with plug-in hybrids adding another 7%. The transition to electric is happening rapidly – Tesla just isn’t the one leading it anymore.
Frequently Asked Questions
Tesla’s deliveries in Europe plummeted 43% in February 2025 compared to the previous year. In the first two months of 2025, Tesla sold only 26,619 vehicles in European markets, down 42.6% from the 46,343 delivered during the same period in 2024, according to the European Automobile Manufacturers Association (ACEA).
Tesla faces intensifying competition from both traditional European manufacturers and Chinese brands. Volkswagen’s ID series, Mercedes-Benz’s EQ range, and BMW’s i series are directly targeting Tesla’s Model 3 and Model Y. Additionally, Chinese manufacturers like BYD are entering with affordable alternatives that often undercut Tesla’s prices.
Several factors contribute to Tesla’s European difficulties:
- Limited Model Range: Tesla relies heavily on just two models (Model 3 and Model Y)
- Price Competition: European and Chinese automakers offer similar or better features at lower prices
- Consumer Preferences: European buyers often prefer smaller cars, hatchbacks, and station wagons
- Local Production: European automakers are increasing local EV production
- Elon Musk’s political activities have reportedly affected sales in Europe
The overall European EV market is growing significantly. According to the article, the European EV market grew by 28% in February 2025 compared to the previous year. Battery-electric vehicles now account for 17% of the entire European auto market, with plug-in hybrids adding another 7%, indicating a rapid transition to electric vehicles.
Yes, according to the article, BYD has overtaken Tesla in global annual revenue for 2024, despite facing EU and US tariffs on Chinese-made EVs. This represents a significant shift in the global EV market landscape.
According to market commentators cited in the article, Musk’s political engagement has contributed to Tesla’s sales decline, particularly in Germany. Ahmad Assiri, research strategist at Pepperstone, noted: “Musk’s political engagement has triggered a significant backlash, notably evident through explicit calls for boycotts, negatively impacting Tesla’s reputation among substantial segments of consumers and investors.”
