Tesla sales plummet over 45% in Europe; Chinese rival BYD outsells in UK

Tesla, the American electric vehicle (EV) giant, has seen its sales crash dramatically across Europe in January 2025, with registrations dropping by nearly 45 per cent compared to the same month last year. The steep decline comes despite a robust 37 per cent surge in overall EV sales across the continent, highlighting a troubling trend for the company once seen as the unrivaled leader in the electric car market.

In key markets, the numbers paint a stark picture. In Germany, Europe’s largest auto market and home to Tesla’s Berlin Gigafactory, sales fell by 59.5 per cent, with only 1,277 vehicles registered compared to 3,150 in January 2024. France, the EU’s second-largest EV market, saw an even more drastic 63.4 per cent decline, with registrations plummeting from 3,118 to just 1,141. The United Kingdom reported a 12 per cent drop in Tesla sales, a relatively modest decline but significant given that total EV registrations in the UK soared by 35 per cent to a record high. For the first time ever, Chinese rival BYD outsold Tesla in the UK, registering more vehicles than Elon Musk’s company.

Across other European nations, the pattern holds: Tesla sales dropped 44 per cent in Sweden, 38 per cent in Norway, 42 per cent in the Netherlands, and a staggering 75 per cent in Spain. Collectively, Tesla delivered approximately half as many vehicles in Europe in January 2025 as it did in January 2024, shrinking its market share even as the broader EV sector thrives.

Several factors appear to be driving this downturn. One is the transition to the updated Tesla Model Y, the company’s best-selling vehicle. The refreshed “Juniper” version, featuring a new design and enhanced features, began production recently, but its limited availability, currently offered only in a pricey Launch Edition, may have prompted potential buyers to delay purchases until more trims hit the market. Tesla’s tendency to push sales in the final quarter to boost year-end financials also left its inventory thin entering 2025, a recurring challenge that hampers first-quarter performance.

However, industry analysts suggest that production hiccups alone don’t fully explain the slump. Tesla faces mounting competition from both European legacy automakers and Chinese manufacturers such as BYD, which saw a 550 per cent year-over-year increase in UK registrations and a 69 per cent jump in Germany. Volkswagen, BMW, and Volvo have also reported significant EV sales growth, bolstered by new, competitively priced models like Volvo’s EX30 and Renault’s R5. With over 130 mainstream EV options now available in Europe - up from just 25 in 2020 - buyers have more choices than ever, eroding Tesla’s once-dominant position.

Adding to the company’s woes is the growing backlash against CEO Elon Musk, whose recent political activism has stirred controversy. Musk’s vocal support for far-right parties, including Germany’s Alternative für Deutschland (AfD), and his calls for UK Prime Minister Keir Starmer’s resignation have drawn sharp criticism from European leaders and consumers alike. Surveys indicate a shift in public sentiment: in Sweden, a Novus poll found that only 11 per cent of respondents now view Tesla positively, down from 19 per cent just weeks ago, while 63 per cent hold a negative opinion. In the UK, a survey by Electrifying.com revealed that 59 per cent of EV owners and prospective buyers said Musk’s influence would deter them from buying a Tesla.

According to reports by various news agencies, Analysts are divided on how much Musk’s polarising persona is impacting sales. “The Model Y transition and a more crowded market are significant factors, but Musk’s political meddling is undeniably a liability,” said Dylan Khoo, an analyst at Argus. “In Europe, where social and political awareness runs high, tying a brand to divisive figures can backfire.” Others, like Cox Automotive’s Philip Nothard, point to Tesla’s aging lineup as a key weakness in a market flush with fresh alternatives.

Tesla’s European struggles follow a challenging 2024, when its sales dropped 13 per cent across the EU, UK, and EFTA combined, and its global deliveries fell 1.1 per cent - the company’s first annual decline in over a decade. While the updated Model Y, set for wider release later this year, and expansions at the Berlin Gigafactory offer hope for a rebound, Tesla faces an uphill battle to regain ground. For now, the company’s European downturn signals a shifting landscape, where rivals are capitalising on both innovation and Tesla’s self-inflicted wounds. As one industry observer put it, “Tesla’s dominance isn’t disappearing, but the road ahead is getting bumpier by the day.”