Tesla Faces Major Setback as European Electric Car Sales Decline

Sales of electric vehicles in Europe are experiencing a notable slowdown, with Tesla, the continent’s leading electric car manufacturer, facing a significant decline in market share. According to recent figures, Tesla’s sales within the European Union plummeted by 48% in October 2023, dropping from 10,800 units to 5,600 units. Over the first ten months of the year, sales are down 39% year-on-year, totaling 117,000 units.

This decline is mirrored across wider Europe, which includes the UK and Norway—two of the highest adopters of zero-emission vehicles. In October, Tesla’s sales in this broader market also fell by 48%, bringing the total to just under 7,000 units. For the year to date, the total sales figure stands at 180,000, reflecting a nearly 30% decrease compared to the previous year.

Tesla previously held a market share of 2.4% of total European sales, translating to 10.8 million vehicles sold in the same period last year. This share has now dwindled to 1.6% of a market that has expanded by 200,000 vehicles to exceed 11 million.

Competition and Market Dynamics

Tesla has opted not to comment on monthly sales figures but has indicated that the transition to the latest generation of its Model Y has been delayed, impacting sales. Compounding this issue is the increasing competition from Chinese manufacturers, particularly BYD, which has gained traction in Europe with comparable-quality vehicles at lower prices. Reports indicate that BYD is outselling Tesla by more than two to one, with the Chinese manufacturer selling 138,000 vehicles in wider Europe so far this year.

Market analysts suggest that Tesla’s declining reputation may also be affecting sales. Some potential buyers, both individual consumers and fleet operators, are reportedly hesitant to choose the Tesla brand due to controversies surrounding the company’s co-founder and CEO, Elon Musk, particularly his political engagements and social media presence.

Despite Tesla’s struggles, the overall electric vehicle market in Europe has not gained the momentum anticipated. The European automobile manufacturers’ association, ACEA, noted that the battery-electric car market share reached 16.4% for the year to date. This figure, while significant, remains below the expected pace required for a successful transition to electric mobility.

Regional Performance in Electric Vehicle Sales

The UK stands as Europe’s second-largest market for electric vehicles, with sales rising by 29% year-on-year to 386,000, which constitutes 22% of all vehicle sales. However, Germany continues to lead as the largest automotive market on the continent, reporting a nearly 40% rise in electric vehicle sales to 434,000 units this year, representing 18% of its total market.

As manufacturers and retailers in the electric vehicle sector strive to recover from the dip in sales following the withdrawal of state subsidies, the future landscape of the market remains uncertain. With rising competition and shifting consumer perceptions, Tesla’s position in Europe may face further challenges in the coming months.