Tesla sales continue to decline in Europe even as EV competitors flourish

Forty percent. That's how much Tesla's European sales declined in July compared to the year before.

The European Automobile Manufacturers Association (ACEA), the lobbying group for the automobile industry in the EU, released new data on Thursday showing that Tesla, led by Elon Musk, is continuing to face a steep decline in sales.

In total, just 8,837 Tesla vehicles were registered across Europe in July 2025. That figure includes the European Union, as well as the United Kingdom, Iceland, Liechtenstein, Norway, and Switzerland.

Furthermore, Tesla's drop in sales is not the result of a broader decline across the larger EV market either. In fact, sales of electric vehicles as a whole actually went up in the EU. For example, Tesla's biggest Chinese rival BYD saw 13,503 new vehicle registrations in July. That's a monthly surge of 225 percent compared to the year before, as CNBC reported.

This also marks Tesla's seventh month in a row of declining sales.

Tesla has also seen declining sales in the United States so far in 2025, though the impending end of the EV tax credit has given EV makers a temporary boost over the summer.

No end in sight for Tesla's woes

Tesla's sales issues began shortly Musk's involvement in the President Donald Trump administration and its Department of Government Efficiency (DOGE). Musk has also been involved in other costly controversies, including his support for a far-right party in Germany.

In fact, in the month after Musk supported the far-right Alternative for Germany (AfD) party, Tesla recorded fewer than 900 sales in Germany — a nearly 50 percent drop.

In July, amid declining sales, Tesla also stopped allowing EU customers to configure and order some of its car models, such as the Model S and X. And, in the U.S., Tesla owners have flooded the market with used Tesla vehicles.

Under increasing pressure, Musk announced in May that he was stepping away from his role with the Trump administration, but Tesla's sales problems have continued.

On top of that, the president's Big Beautiful Bill will see the end of a vital source of Tesla's revenue: Carbon credits.

Over the past decade, these regulatory credits have accounted for a whopping $11.8 billion in revenue for Tesla.

Finally, the federal EV tax credit will expire on Sept. 30, which will immediately make electric vehicles more expensive for U.S. shoppers.