Tesla sales have dropped sharply in the European market, as the U.S.-based electric carmaker faces both business headwinds and public blowback against the unprecedented political activity of its chief executive.
Data released this week by the European Automobile Manufacturers' Association (ACEA) show that Tesla registrations in the European Union, Iceland, Liechtenstein, Norway, Switzerland and the U.K. dropped by 45% in a head-to-head comparison between January 2024 and January 2025. (Registrations are a closely tracked indicator of sales.)
That's a precipitous decline, and it comes even as electric vehicle sales overall were increasing in the region — up 37% in the same time frame.
Data previously released in individual nations covering the same period also showed that Tesla sales were down nearly 60% in Germany, Europe's largest EV market, with large decreases also evident in France and Norway.
Mark Wakefield, the global automotive market lead at the consulting firm AlixPartners, cautions that it's hard to draw conclusions from a single month of data, because Tesla deliveries can fluctuate significantly month by month. "You really have to look at it quarter by quarter," he says, although he notes that other data points, like the incentives Tesla is offering to encourage sales, also indicate slowing demand for the vehicles.
Multiple factors may be at play here. Tesla has not yet delivered a long-promised cheaper vehicle, and its best-selling Model Y is getting an update soon — a reason some buyers might delay a purchase.
Meanwhile, competition from China has been intensifying. In January, according to the ACEA data, Tesla clocked the largest — by far — decrease in sales of any auto manufacturer in Europe. The largest increase, at 36.8%, was for SAIC Motor, a Chinese automaker whose brands include MG.
Europe has tried to block Chinese EVs from overtaking the European market, but in response companies like SAIC Motor are pivoting to hybrids. In January, SAIC Motor sold more than twice as many vehicles in Europe as Tesla did, according to the ACEA data.
Wakefield says he thinks the Model Y refresh is a significant factor in Tesla's declining sales in Europe. But, he says, the "visceral reactions" to Elon Musk's political activities "certainly has an impact as well."
After Musk made a straight-armed gesture twice during a speech celebrating President Trump's inauguration on Jan. 20, someone projected a photo of it onto the side of the Berlin Gigafactory in Germany with the word "Heil" added before the glowing "Tesla" sign. A satirical ad posted at a bus stop in London showed the gesture and called a Tesla a "Swasticar." And after Musk appeared virtually in late January at a campaign event for Germany's right-wing AfD party and said that Germany needs to "move beyond" past guilt, the Polish government called for a boycott of Tesla vehicles. The AfD polled second in German elections last weekend.
The outcry is significant, Wakefield says, and taken very seriously in Germany, although he says that in general, public outcry about executive behavior has only a "muted connection" with people's buying decisions.
Tesla and Musk have not responded to requests for comment. The company has not publicly commented on the sales drop, although its most recent SEC filing acknowledged risks from increased competition in Europe.
Tesla share prices have dropped by about a third since President Trump took office, erasing virtually all of the stock gains the company enjoyed post-election.
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