Tesla’s sales in Europe have crashed and burned. They fell by nearly 39% just in the first four months of this year, per new data from the European Automobile Manufacturers Association (ACEA). The company delivered 61,320 vehicles during that time. This number stands in stark opposition to the increasing trend in the wider European auto market.
Tesla is getting slaughtered on sales right now. The increasing trade tensions started by U.S. President Donald Trump are mainly responsible. This kind of antagonism from European consumers toward American brands has been the unintended result of Trump’s trade war. President Trump’s ongoing threats to impose a 50% tariff on all goods imported from the European Union have only added fuel to the fire. This action has created a storm of anxiety among would-be purchasers.
Tesla had a tough time, but even then, the European auto market was able to continue expanding. To be sure, auto sales were up 1.3% in April year-over-year. Battery-electric vehicle sales from all manufacturers combined jumped by nearly 28% in that time. This metric demonstrates the accelerating consumer preference toward EVs, though it does not bode well for Tesla.
As competition increases through new entrants and true competition from lower-priced Chinese brands, Tesla goes into earnings with growing pressure. At China’s SAIC, meanwhile, sales surged 54% in April. This rapid ascent speaks to the growing demand—relying on basic market economics—among European consumers for lower-priced EVs. This slow but steady trend is a huge challenge for Tesla, as it tries to hold onto its incredible market share.
Trump’s response to the escalating trade pressure has been to blame the EU for being “very very hard to deal with.” This allegation points to a deteriorating bilateral relationship that might further affect American companies doing business in the area. Instead, he agreed to hold off on new tariffs until July. Even with this resolution, uncertainty especially related to future US trade policies continues to cloud Tesla’s European operations.
ACEA’s most recent numbers paint a dire picture for Tesla’s fortunes in Europe. At the same time, the broader auto market is doing better overall. The industry is quickly pivoting to meet new consumer demands and current economic realities. Tesla will need to thread the needle on these challenges to get back on track in Europe.
