Tesla’s vehicle sales in Europe dropped sharply by 40 percent in July 2025 compared to the same month last year, according to data released by the European Automobile Manufacturers Association (ACEA). The U.S.-based electric vehicle maker registered 8,837 new cars across the European Union, European Free Trade Association countries and the UK, marking the company’s seventh consecutive monthly decline in the region. Meanwhile, Chinese electric vehicle manufacturer BYD more than tripled its new car registrations in Europe during the same period.
The company reported 13,503 new vehicles registered, overtaking Tesla for the first time in the European market. This gave BYD a market share of 1.2 percent in July, while Tesla’s share fell to 0.8 percent. The broader European automotive market posted solid gains, with overall new car registrations rising 5.9 percent in July compared to a year earlier. This marked the highest monthly increase since April 2024. Growth was led by Germany, Spain, Poland and Austria, while markets such as the UK, France and Italy experienced slight declines.
Battery-electric and hybrid vehicles accounted for a growing proportion of sales across the region. Combined, electrified vehicles represented nearly 60 percent of all new registrations in July, an increase from just over 51 percent in the same month of 2024. This included battery-electric vehicles, plug-in hybrids and traditional hybrids. BYD’s strong performance reflected a 225.3 percent increase in registrations year-over-year, positioning the company as one of the fastest-growing EV manufacturers in Europe.
Electrified vehicles account for nearly 60 percent of sales
Tesla’s decline contrasts sharply with this trend and reflects broader changes in the competitive landscape of the European electric vehicle market. Among established European automakers, several reported positive growth. Volkswagen Group saw an 11.6 percent rise in new registrations year-on-year, while Renault Group recorded an 8.8 percent increase. Stellantis, however, experienced a decline in sales over the same period.
ACEA’s data also showed that the total number of new passenger car registrations across the EU reached nearly 1 million units in July. This sustained rebound in overall vehicle demand continues a recovery trend that began in early 2024 following previous supply chain disruptions and a slowdown in economic activity across the continent. In the UK, government incentives supporting electric vehicle adoption have recently been reinforced. Grants of up to £3,750 are now available for EVs priced under £37,000, which may impact market dynamics in the months ahead.
EV registrations highlight competitive landscape
However, July figures show that the UK’s total new car registrations declined slightly year-over-year. Tesla’s decline in the European market comes as competition intensifies across the EV sector, particularly from Asian manufacturers and cost-competitive domestic brands. While Tesla continues to dominate in certain global markets, its reduced performance in Europe reflects regional shifts in demand and product availability. The ACEA report does not include detailed breakdowns by vehicle model, but data from national registration agencies indicates that BYD’s Atto 3 and Dolphin models contributed significantly to its growth in European sales.
Tesla’s Model Y, previously among the region’s top-selling EVs, saw a marked decline in registrations. The latest figures underscore significant changes in Europe’s electric vehicle sector, where monthly sales performance has become a key indicator of market direction amid rapid technological shifts and regulatory changes. The evolving registration data provides insight into the current positioning of key manufacturers as the continent accelerates its transition to electrified transport. – By EuroWire News Desk.