Once Tesla sales fell 40 per cent in July in Europe and new vehicle car sales in China increased 225 per cent annually, with new car registrations of Tesla vehicles amounting to 8,837 cars in July and BYD cars at 13,503 cars, according to the European Automobile Manufacturers Association (ACEA), as the electric car market experiences significant competition and reputational damage caused by Elon Musk entering politics, Tesla is experiencing downward sales with declines in sales per month over the last seven months.
Tesla is experiencing its seventh month of decline
Tesla car sales in Europe collapsed in July, the seventh month in a row of downward trends, and Chinese competitor BYD recorded a monthly increase, data published on Thursday indicated, according to CNBC. The European Automobile Manufacturers Association, or ACEA, registered 8,837 new Tesla vehicles in July, half the number of the previous year.
BYD registered 13,503 new cars in July, which is 225 percent per annum. Tesla losses occurred despite the general increase in battery electric car sales in Europe reported by ACEA data. Tesla sold 43.5 fewer cars in the EU in the first half of 2021, and in July alone, Tesla sold 42.4 fewer cars in the block.
Chinese manufacturers acquire a lot of market share
Back home, Chinese EV manufacturers are ruthlessly sweeping away, the most recent entrant of this group being BYD, which grew its sales over 200 per cent in July and over 250 per cent in the first seven months of 2025, Euronews reported. The market share of BYD in the EU, which stood at 0.7 in July, surpassed that of Tesla at 1.1 in July alone.
Numerous issues affect Tesla’s performance
The automaker run by Elon Musk has several issues in Europe, such as the existence of strong competition within the sector and the harm the brand suffers due to the brand-damaging rhetoric and association with the Trump administration of the billionaire. Tesla has not had it easy in recent times, and in fact, auto sales revenue of the company saw a decline during the second quarter of the year.
A major problem with Tesla is that it has not recently refreshed its car line-up. In 2021, the company announced that it was developing a cheaper electric vehicle, and that it would be produced in large volumes in the second half of 2025, which investors hope will boost sales again.
Thomas Besson, the automobile sector research director of Kepler Cheuvreux, added that Tesla management has been attempting to convince investors that Tesla is not actually a car maker by discussing artificial intelligence, robotics, and autonomy. According to CNBC, Besson said that they discuss virtually everything other than the car that they are selling more slowly.
Chinese brands are at their highest European presence
According to JATO Dynamics data, Chinese brands recorded an unprecedented market share rate of over 5 percent in the first half of the year. State-owned automaker SAIC Motor, another Chinese brand, including IM Motors, Roewe, and MG, has been experiencing slow growth in car sales in Europe and achieved a market share of 1.9 percent in the first half of 2010.
Tesla is not the only company that is feeling the heat because of the competition in China. In July, Stellantis, which owns Jeep, the Hyundai Group of South Korea, Toyota, and Suzuki of Japan, recorded year-on-year declines in new car registrations across Europe. Other companies, including Volkswagen, BMW, and Renault Group, registered growth in new European cars.
The sharp sales fall in Europe underscores the stiffening competition in the electric vehicle market as Chinese rivals such as BYD continue to rapidly gain momentum through aggressive pricing and new product introductions, and Tesla faces the need to refresh its products heavily to hold onto its market share, particularly as its vehicles get older.