Sales of the company led by Elon Musk, the American billionaire associated with the president's administration Donald Trump, fell 49% in January and February, reaching 19,000 vehicles compared to 37,000 over the same period in 2024, according to data from the European Automobile Manufacturers' Association.
With this decline, Tesla's market share in the European car market fell from 2,1% to 1,1%, while electric vehicle sales increased sharply in the European Union. The Automobile Manufacturers Association reported a 28,4% increase in battery electric vehicle registrations over the same period compared to 2024.
Tesla shares have lost 30,25% since the beginning of the year, closing the last trading session at $272.
A step back before a new model
Beatrix Kaem, director of the Center for Automotive Research, believes that "this decline in sales is normal before the launch of a new model."
In an interview with Al Jazeera in Berlin, she added that "the arrival of new brands, both established and emerging, on the market with attractive electric vehicles has intensified competition in this sector, especially with the gradual increase in demand for electric vehicles in different categories."
However, Kaem stressed that "the politically motivated activities ofElon Musk are not always understood or accepted, either by public opinion or political circles, whether because of its role in the recent German election campaign or on the American political scene." She believes that this could be one of the factors currently affecting Tesla's performance.
Sales drop in Germany
Germany's Federal Transport Authority has announced a significant drop in new Tesla vehicle registrations in the country, with a 76% year-on-year drop in February, following a 59% decline in January.
Tesla has a factory in Grünheide, near Berlin.
Germany is the largest European market, particularly for electric cars. While the luxury car segment, to which Tesla belongs, has seen notable growth, Kaem explains that Tesla's sales decline is due to several factors, including "consumer expectations for innovations in the Tesla range, whether for updates or new models, as well as the growing offering of solid alternatives from established brands and the entry of new players, notably from China, Vietnam, and the American company Rivian."
Kaem does not rule out that "the rapprochement of some Tesla executives with the far-right Alternative for Germany party has led some German consumers and institutions to make decisions unfavorable to Tesla." In this context, several German companies have terminated their contracts with Tesla as a supplier for their fleet, including energy suppliers. Some Tesla owners in Germany have even put stickers on their vehicles to express their disagreement with Elon Musk's positions.
Challenges and battle for survival
One of Tesla's main challenges in Europe is its limited model range. While traditional manufacturers and new entrants, particularly Chinese ones, are launching more modern and technologically advanced models at competitive prices, Tesla urgently needs to refresh its offering.
Although Tesla was a pioneer in electric vehicles and was able to attract customers with attractive vehicles and advanced charging infrastructure, this is no longer enough today, according to Kaem. "Other companies are now offering a wider range of models at more competitive prices, and this doesn't just apply to Chinese manufacturers, but also to traditional European manufacturers," she says.
Today, Tesla is engaged in what Kaem calls "a battle for survival" in the European market. The company's future will depend on its ability to overcome this crisis, especially as doubts persist as to whether this decline in sales is solely due to a delay in the launch of new models or if the problem runs deeper.
Kaem concludes by emphasizing the importance of "clarifying issues related to data security and vehicle reliability, particularly with regard to autonomous driving or semi-autonomous driving systems (FSD), not only in the United States, but globally," believing that these factors could play a key role in Tesla's future.
