Tesla sales fall 40% in Europe while BYD posts strong growth

European sales of Tesla vehicles fell sharply in July, marking the seventh consecutive month of decline, while Chinese automaker BYD saw a significant increase, according to data released Friday by the European Automobile Manufacturers Association (ACEA). 

Tesla recorded 8,837 new registrations in July, down 40% year-on-year, whereas BYD registered 13,503 vehicles, up 225% annually.

The decline in Tesla sales occurred despite overall growth in Europe’s battery electric car market. Analysts attribute the slump to intensified competition, reputational challenges, and a lack of major updates to Tesla’s vehicle line-up. The company plans to launch a more affordable electric car in the second half of 2025, aiming to boost volume sales.

Thomas Besson, head of automobile sector research at Kepler Cheuvreux, said Tesla’s management has focused heavily on artificial intelligence, robotics, and autonomy, while current vehicle models face aging and limited market appeal. He noted that models like the Cybertruck have not met sales expectations.

Chinese brands, led by BYD, have been expanding aggressively in Europe through competitive pricing and the opening of new showrooms. JATO Dynamics data show that Chinese automakers reached a record market share of more than 5% in the first half of 2025.

The European auto market saw mixed results in July, with declines reported by Stellantis, Hyundai, Toyota, and Suzuki, while Volkswagen, BMW, and Renault recorded growth in new registrations.