Asger Risom
Europe’s electric car market is booming, but one major player is struggling to keep pace.
Tesla’s push to revive its European sales with cheaper versions of its best-selling cars appears to be falling flat, according to newly released registration data.
While electric vehicles continue to gain ground across Europe, Tesla has largely missed out on that growth. Increased competition, particularly from Chinese manufacturers, has reshaped the market and left buyers with more choice than ever.
A booming market
Europe has become one of the most competitive EV regions in the world. Automakers have expanded their lineups rapidly, and consumers now have access to a wider range of models at different price points.
That shift helped electric cars outsell petrol vehicles in Europe for the first time in December, underscoring how quickly the market is changing.
Tesla, however, has struggled to benefit from that momentum. Its sales across the continent declined sharply last year, raising questions about its strategy in the region.
Cheaper models tested
In response, Tesla rolled out lower-priced versions of the Model Y and Model 3, stripping back features in an effort to make the cars more affordable.
The Model Y Standard and Model 3 Standard were expected to help reverse declining sales in key European markets. Early figures from January suggest that impact has been limited.
According to Reuters, Tesla registrations rose in some smaller markets but fell sharply elsewhere.
Mixed January results
“Elon Musk’s full-electric brand, whose market in the continent shrank 27% last year, registered 26% more cars in Sweden and 3% more in Denmark in January than in the same month of 2025, with 512 and 458 cars sold respectively, official data showed on Monday,” Reuters reported.
But the picture was far worse in other countries. “Its registrations, a proxy for sales, fell 88% to 83 vehicles in Norway, one of the most brand-loyal countries in Europe which has been at the forefront of EV adoption, and by 42% to 661 in France,” the news agency said.
Bigger ambitions
Tesla executives have recently emphasised ambitions beyond car sales, pointing to artificial intelligence, robotics, autonomous taxis and energy storage as future growth drivers.
Yet vehicle sales remain Tesla’s most reliable source of revenue. If declines in Europe persist, the company may find it harder to offset that weakness with longer-term bets.
A more detailed assessment of the new Model Y Standard is expected in the coming weeks, which may offer further insight into why the strategy has yet to gain traction.
Sources: Reuters
