Tesla stock drops after Europe sales collapse, down over 20% in August
The pain across the pond in Europe is growing for Tesla (TSLA).
Per the European Automobile Manufacturers’ Association (ACEA), Tesla EV registrations (a proxy for sales) in Europe fell to just 14,831 units in August, a 22.5% drop compared to a year ago. Meanwhile, total EV registrations in the region, which includes the UK and the European Free Trade Association (EFTA), rose 26.8% in August, with overall registrations regardless of powertrain up 4.7%.
August’s total marks the eighth straight month of declining Tesla sales in Europe. However, August’s total was better than the drop seen in July, when sales slid 40.2% year over year to 8,837 units.
Tesla stock was down over 3% in midday trade.
Tesla’s sales hangover rolled on in certain key territories in Europe as the introduction of the revamped Model Y wasn’t enough to blunt the effect of rising competition and CEO Elon Musk’s deep unpopularity.
Earlier this month France’s PFA auto lobby reported Tesla registered only 1,331 vehicles compared to 2,532 a year ago, representing a 47.2% drop. Meanwhile, overall August auto sales in France were up 2.2% in the month.
Tesla sales in Sweden (down 84%) and Denmark (down 42%) tumbled as well, per Mobility Sweden and Mobility Denmark. EV-crazed Norway was a lone bright spot, with sales up nearly 22%. Germany and the UK, Tesla’s two other larger territories, will report August sales later this month.
August’s weakness follows a rough 2025 overall. In the first eight months of the year, Tesla sales dropped 32.6% to 133,857 units, again per the ACEA. Conversely, Tesla’s overall market share in Europe dropped to 1.5% from 2.3% a year ago.
Musk warned after Q2 earnings that Tesla was in for a “few rough quarters” as the company delayed the launch of its cheaper EVs until the federal EV tax credits expired in the US.
But Musk’s warning doesn’t mention his reputational hit stemming from his political involvement in the Trump administration, the rise of more competition, and consumer preferences for vehicles like hybrids that have Tesla and the EV industry as a whole worried.
Recent data notes the rising popularity of Chinese EVs to the detriment of American ones, namely Tesla’s.
Research firm Escalent found that 47% of European buyers would consider a vehicle from China, whereas only 44% would consider an option from a US automaker. In 2024, those figures were flipped, with 31% considering Chinese vehicles and 51% considering American.
Since Chinese automakers like BYD (BYDDY) sell a larger number of EVs and plug-in hybrids in Europe, it seems those buyers are substituting Chinese EVs for Tesla vehicles, which are far and away the highest-selling US EVs.
Tesla will give investors an official update of its overall third quarter numbers next week.
Pras Subramanian is the lead auto reporter for Yahoo Finance. You can follow him on X and on Instagram.
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