Tesla’s sales in Europe have plummeted by 42% this year, according to the latest figures from the European Automobile Manufacturers Association.
Tesla’s slip came despite total EV sales on the continent rising 28% over the same period. Analysts have linked the slump to Tesla’s aging model lineup and growing backlash against CEO Elon Musk’s increasingly polarising behaviour.
Whatever the reason, Andrew Fellows, an automotive and mobility expert at global tech consultancy Star, told TNW he thinks the recent sales slide has opened “a rare window of opportunity” for rival European carmakers to regain lost ground from Musk’s firm.
Tesla’s Model Y has been the best-selling EV in Europe for two years in a row. But in February, both Volkswagen and the BMW Group (including Mini) overtook Tesla in total EV sales for the first time, according to data from Jato Dynamics.
VW’s sales were up 180%, with its ID.4 beating out the Model Y to become the best-selling EV in Europe last month. Sweden’s Polestar sold 2,000 cars, representing an 84% jump. The company has been actively targeting disgruntled Tesla owners with special offers on its EVs.
Tesla’s public image is suffering under Musk, whose role in the Trump administration and endorsement of Germany’s far-right AfD party have drawn widespread condemnation in Europe.
Tesla’s dealerships have been vandalised. Its cars have been set on fire. In one of the more dramatic expressions of outrage, political campaigners beamed an image of Musk making a Nazi-like salute alongside the word “Heil” onto Tesla’s gigafactory in Berlin.
With Tesla fighting fires, now could be the opportune moment for European automakers to strike. However, they’ll need to move quickly because Chinese car companies are looming large.
The EV challengers to Tesla
“Chinese EV brands are entering the European market at pace, offering strong performance, advanced software and aggressive pricing,” said Fellows. “While they still lack the branding power of their European rivals, they’re moving fast and learning quickly.”
In February, BYD’s EV sales in Europe almost doubled from the same month last year. Combined, Chinese-owned brands, including BYD, Xpeng, and Leapmotor, sold more electric cars than Tesla, according to Jato Dynamics.
Dr Henning Dransfeld, an Austrian automotive expert and a director at software firm Infor, told TNW that the rise of Chinese EVs presented a “fundamental threat” to European carmakers.
“While all eyes are on Tesla’s stumble, Chinese manufacturers are reshaping our industry’s competitive landscape,” he said.
Bolstered by strong state subsidies, Chinese automakers could surpass European brands, even with the EU’s proposed tariffs on Chinese-made EVs.
The only way for European carmakers to stay competitive, said Fellows, is to build better EVs and lower prices.
“European manufacturers [need to] respond with more affordable models, smarter branding, and better software,” he said. “If they hesitate, Chinese brands will seize the opportunity created by Tesla’s decline and Europe’s carmakers may find themselves chasing from behind once again.”