Tesla's EV Market Share Plummets in Europe, US Competition Intensifies
Tesla, once a dominant force in the electric vehicle (EV) market, is facing stiff competition in the US and Europe. Sales have been declining, with buyers opting for hybrid or internal combustion engine vehicles. Meanwhile, Elon Musk, Tesla's CEO, remains at the helm, overseeing global operations including Europe, despite the setbacks.
In Europe, Tesla's market share has plummeted to 1.2%, with a 43% drop in registrations in the first eight months of 2025 compared to the previous year. This decline comes despite Musk's takeover of direct supervision of production and sales in Europe over the summer, following the departure of his long-time associate Omead Afshar.
Analysts had predicted a decrease in Tesla's deliveries, but the company surprised them with a 7.4% year-over-year increase in the last quarter, reaching 497,099 vehicles. This increase was likely driven by buyers rushing to take advantage of the $7,500 US tax credit for EVs before it expired. However, production numbers tell a different story, with a 4.8% decrease to around 447,410 vehicles in the same quarter.
Musk has acknowledged challenging quarters ahead for Tesla. Indeed, deliveries had dropped by around 13% each quarter in the first half of the year. The transition phase of the Model Y and controversies surrounding Musk's political activities were cited as reasons for the initial sales decline in the first quarter.
Tesla's competition in the EV market is intensifying, with buyers in the US and Europe opting for other vehicle types. Despite the challenges, Tesla's deliveries increased in the last quarter, likely due to the US tax credit. However, production numbers indicate a decline. With Musk at the helm, Tesla will need to navigate these challenges and adapt to maintain its market position.
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