European motorists are increasingly switching to EV vehicles, but Tesla sales across the continent are stuck in the slow lane — and it is all because of CEO Elon Musk. Tesla’s European sales have all but collapsed in the first quarter of 2025, with year-on-year sales down 44% in February. It is no coincidence that this slump has overlapped with Musk’s high-profile role in the Trump administration and his growing presence as a powerful, yet controversial, far-right political figure.
Europe is on the road to widespread EV motoring while Tesla is stalling on the hard shoulder
Tesla’s struggles are hitting at a time when its vehicles should be flying off the showroom floor. According to the European Automobile Manufacturers’ Association (ACEA), battery electric vehicle (BEV) sales in Europe rose 34% year-on-year in January 2025 and 24% in February. Demand has spread across multiple countries, with Italy (+126%), Denmark (+123%), and Norway (+90%) leading the pack in February's year-over-year changes. Driver demand is there and it is growing.
European drivers have joined forces to shun Tesla
However, there is a little appetite for Tesla models, with data from EU-EV indicating a persistent slump. Though March data is only available by country, it reflects widespread declines across the region, with sales falling more than 50% in Denmark, Switzerland, Sweden, and the Netherlands. Only Italy and Spain posted gains.
Rival manufacturers are benefiting from the Musk boycott
Tesla’s February drop came just as many competitors saw significant growth. While Tesla’s sales fell dramatically, rivals including Renault, Ford, Citroën, and Volkswagen posted strong gains. Volkswagen, Renault, and Ford more than doubled the number of EV registrations recorded in February, for example. Even brands like BYD and Kia saw notable growth. Some of those increases were from smaller bases – Tesla accounted for 12% of all EV registrations in the EU, while the next five biggest brands – Volkswagen, Renault, Ford, Citroën, and BYD – captured a combined 39% – but the underlying trend is clear: Tesla was once the go-to for drivers switching to EVs. That crown has clearly slipped, and its rivals are the ones benefiting.
Tesla’s dominance in multiple key markets is weakening
With more brands entering the EV space amid sustained demand, Tesla is quickly losing market share in markets it has dominated for several years. In February, it lost more than 15 percentage points year-over-year in Italy, Portugal, Switzerland, and Austria. March followed a similar trajectory, with market share dropping by more than 20 points in Switzerland, Sweden, and the Netherlands.
The scale of Tesla’s losses – especially in progressive, high-EV-penetration countries – could be attributed to a brand being actively rejected by the very consumers leading Europe’s energy transition.
The Musk-MAGA effect is not making Tesla great again
Across Europe, Elon Musk’s politics are becoming a liability for his business interests, with Tesla stocks plunging and investors calling for him to step down.
Once seen as a pioneer in clean mobility, his growing political profile has sparked public criticism – which is increasingly reflected in consumer sentiment and Tesla’s performance across Europe. In a matter of months, Musk has aligned himself with extremist parties in Germany and clashed with the governments of Ukraine and South Africa. In his role as President Trump’s head of government efficiency (DOGE), he has attracted reams of bad press after unilaterally attacking the U.S. federal government with mass layoffs and sweeping cuts. Privacy experts have been alarmed over his access to sensitive personal data, and mass protests have taken place across the country.
Meanwhile, his social media platform has been used to amplify election misinformation and partisan culture wars. Consumers are making their distaste clear. In a January 2025 YouGov poll, strong majorities in both Germany (73%) and the UK (69%) called Musk’s political interventions “unacceptable.” Similar majorities in both countries said he had little or no understanding of their national political issues.
“The more Musk tweets, the more Teslas sit on the lot,” one Dutch auto dealer told Politico EU – a quote emblematic of growing dealership-level frustration with the brand’s direction. This reputational damage is contributing to institutional unease, too. ESG funds and European institutional investors are scaling back, citing reputational and governance concerns. Likewise, former top shareholder Baillie Gifford slashed its Tesla stake in 2024, citing “non-business distractions” as a factor.
Tariffs, protectionism and EU regulators also have Tesla in their crosshairs
Tesla’s troubles in Europe go beyond consumer perception and stalling sales – they are also structural. The company is now caught in the crossfire of rising EU protectionism and EU regulators, not to mention feeling the financial pressures of US cross-border tariffs.
Tesla is firmly tangled in ongoing EU China tensions
Tesla may be an American EV icon, but it is increasingly reliant on Chinese manufacturers. Many of the vehicles it sells in Europe – especially the Model 3 – are made in Shanghai. That is now a vulnerability. In 2023, the European Commission launched an anti-subsidy investigation into Chinese-made electric vehicles, naming Tesla among the companies under scrutiny.
The outcome of the investigation could be costly for Tesla and may see its China-made models losing their price advantage. That potential financial blow comes just as European automakers like Renault, Peugeot, and Volkswagen – all of which manufacture locally — are gaining ground.
Musk’s political risk is growing and could engulf Tesla
There is another layer of exposure, too – this one is tied to Elon Musk’s social media platform, X (formerly Twitter). In the last 12 months, the European Union has intensified its scrutiny of the platform under its Digital Services Act. EU officials have warned of possible sanctions due to X’s failure to curb misinformation and extremist content. If regulatory pressure escalates, Tesla could feel the heat of the fallout, as public institutions and investors begin to treat the company as part of a larger Musk-branded risk profile. In other words: Tesla’s policy challenges in Europe are not just about where its cars are made. They are also about what Musk’s other companies are doing.
More than just a sales slump
While the European EV market is steadily increasing and finding favour with motorists across the continent, Tesla is losing market share, public trust, and institutional support. Unlike traditional setbacks driven by competition or product cycles, this one appears deeply rooted in leadership, identity, and politics. In a market where brand perception matters as much as performance, Tesla’s most serious problem may be one it can not design its way out of.