Europe’s car market extended its recovery in July, but the momentum was far from even. New passenger car registrations rose 2.8 percent across the EU, according to the European Automobile Manufacturers’ Association (ACEA). Yet Tesla, once the symbol of electric vehicle growth, posted one of the sharpest declines of any major brand.
A total of 851,000 cars were sold during the month, marking the twelfth straight year-on-year increase. Germany led with more than 6 percent growth, while France and Italy inched up slightly. Spain was the only large market to slip into decline, showing how fragile household demand remains under high interest rates.
At the brand level, Volkswagen retained its dominance, and BMW and Mercedes-Benz delivered steady figures. Tesla, however, saw registrations plunge almost 30 percent compared with July 2024. The drop reflects not just intensifying competition and shrinking subsidies, but also reputational headwinds. Elon Musk’s controversial public statements, combined with U.S. political turbulence around climate policy and EV incentives, are increasingly weighing on the company’s image in Europe.
Year-to-date, Tesla’s EU sales are down 18 percent to just over 185,000 vehicles, while the overall market is up 5.2 percent to 6.6 million units. This contrast highlights how the company is losing share in a sector that, despite economic headwinds, continues to grow.
Source: European Automobile Manufacturers’ Association (ACEA), “New Passenger Car Registrations, July 2025”, 3 September 2025.
