Tesla’s EU Sales Plunge Despite Soaring EV Demand in May

Tesla’s European vehicle sales fell sharply in May, even as overall electric vehicle (EV) demand surged across the region. According to the European Automobile Manufacturers’ Association, Tesla (NASDAQ: TSLA) registered 13,863 new vehicles in the European Union, EFTA, and the UK—a 27.9% drop year-over-year.

This decline stands in stark contrast to the broader EV market, where battery electric vehicle (BEV) registrations rose 27.2% to 193,493 units. Hybrid and battery-powered vehicles helped lift total car registrations in Europe by 1.9% year-over-year, reaching 1.1 million units in May. Meanwhile, petrol and diesel vehicle sales declined significantly, down 19.5% and 27.6%, respectively.

Tesla, which relies solely on BEVs, is facing growing competition from European automakers and low-cost Chinese EV manufacturers like SAIC Motor. These rivals are expanding their offerings rapidly, appealing to a broader consumer base. Additionally, Tesla’s aging product lineup is under increasing pressure to keep pace with market innovation.

Public backlash against CEO Elon Musk’s political views may also be weighing on Tesla’s image in Europe. The company has faced mounting consumer boycotts across both the U.S. and Europe, further impacting demand. As a result, Tesla’s year-to-date sales in Europe have dropped 37.1% compared to last year.

Despite the challenges, Tesla continues to bet on artificial intelligence and autonomous driving as future growth engines. The recent rollout of its robotaxi pilot in Austin, Texas, received a warm response from shareholders.

Tesla stock is currently down 10% in 2025, although it has recovered a large portion of its earlier losses. With intensifying EV competition and growing political scrutiny, Tesla’s position in the European market remains under pressure.