Introduction: Tesla sales fall 40% across Europe
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Tesla’s European sales slump has continued, as it faces rising competition in the battery-powered electric car market.
New sales figures released by the European Automobile Manufacturers Association (ACEA) this morning show that Tesla shipments tumbled 40% last month. The company sold 8,837 vehicles across the European Union, the EFTA trade block and the UK in July, down from 14,769 in July 2024.
The sales slump, which began at the start of this year, continued despite the recent revamp of Tesla’s signature Model Y, indicating that the backlash against CEO Elon Musk’s political views could still be hurting the company.
Musk’s recent break-up with Donald Trump hasn’t, yet, revived the company’s fortunes. July’s 40% sales fall was worse than the total for 2025 to date, which are down 33% for the January-July period.
Tesla also faces rising competition, particularly from Chinese manufacturers. BYD, the Shenzhen-headquartered carmaker, more than tripled its sales year-on-year in July, up from 4,151 a year earlier to 13,503 last month, a rise of 225%.
This gave BYD a 1.2% market share, higher than Tesla’s 0.8%.
BYD, which overtook Tesla for European sales back in April, recently launched its Dolphin Surf EV car, which is priced from £18,650 in the UK.
ACEA also reports that in the first seven months of 2025, 1,011,903 new battery-electric cars were registered, accounting for 15.6% of the EU market share.
Hybrid-electric car registrations proved more popular, though, with 2,255,080 units sold across the EU so far this year. This was driven by growth in the four biggest markets: France (+30.5%), Spain (+30.2%), Germany (+10.7%), and Italy (+9.4%). Hybrid-electric models now account for almost 35% of the total EU market.
Overall, new car sales in Europe rose 5.9% in July, to 1.085 million.
The agenda
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10am BST: Eurozone confidence data
-
1.30pm BST: US Q2 GDP (second estimate)
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1.30pm BST: US weekly jobless claims
Key events
Over in Manila, the Philippines central bank has cut interest rates despite trade war concerns.
The Bangko Sentral ng Pilipinas lowered its overnight target reverse repurchase rate by 25 basis points (a quarter of one percentage point) to 5% today, in line with expectations.
It cut borrowing costs after concluding that inflation expectations remain well-anchored, with inflation forecast to average 1.7% this year.
But, it added:
Meanwhile, possible electricity rate adjustments and higher rice tariffs could raise inflationary pressures over the policy horizon.
The Monetary Board observed that domestic demand has held firm. However, the impact of US policies on global trade and investment continue to weigh on global economic activity. This could temper the outlook for the Philippine economy.
Ford first manufacturer to receive UK’s £3,750 EV grant
Back in the car sector, Ford has today become the first manufacturer to be awarded the UK’s full electric car grant of £3,750, cutting the cost paid by consumers.
Two Ford models, the Puma Gen-E and e-Tourneo Courier, now qualify for the grant, the Department for Transport has announced.
They are the first to benefit from the full £3,750 subsidy. Another 26 models now get the smaller grant, which knocks £1,500 off their price.
The scheme is meant to make it cheaper and easier to own an electric car.
Transport Secretary Heidi Alexander said:
We’re putting money back in people’s pockets and making it easier and cheaper for families to make the switch to electric, by delivering discounts of up to £3,750 on EVs.
Our measures are driving competition in the UK EV market, boosting economic growth and supporting jobs and skills as part of our Plan for Change.
Drax being investigated by FCA over biomass sourcing
Newsflash: UK energy producer Drax is being investigated by the Financial Conduct Authority (FCA).
Drax has told the City that it learned on Tuesday that the City watchdog had begun an investigation into “historical statements regarding Drax’s biomass sourcing and the compliance of Drax’s 2021, 2022 and 2023 Annual Reports with the Listing Rules and Disclosure Guidance and Transparency Rules.”
Drax, which operates a wood-burning power station in North Yorkshire, added that it will cooperate with the FCA’s investigation.
The FCA has confirmed that it has opened an investigation, without giving more information.
The company has faced pressure to disclose full details of its tree consumption; last year it agreed to pay £25m for submitting inaccurate data on the sourcing of wood pellets.
Elsewhere in the auto industry this morning, new data shows that Britain’s car production grew for the second month in a row in July.
Car production rose 5.6% in July from last year to 69,127 units, the Society of Motor Manufacturers and Traders (SMMT) reported.
However, total vehicle production dropped by 10.8% at 72,006 units, due to a fall in commercial vehicle manufacturing.
Car production recovery continues in July
🚗 Car production rises for second successive month, up 5.6% in July to 69,127 units.
🚚 Commercial vehicle output falls -81.1% reflecting restructuring and bumper month last year.
⬇️ Total vehicle production down -10.8% in the month to… pic.twitter.com/yRgaDdoT9L— SMMT (@SMMT) August 28, 2025
Commercial vehicle (CV) output fell -81.1%, reflecting plant restructuring and a bumper month last year, when the sector recorded the best July in 17 years which, when combined, dragged total vehicle production down -10.8% to 72,006 unitshttps://t.co/xDdFYQF8sb pic.twitter.com/OgHLWHARGM
— SMMT (@SMMT) August 28, 2025
The European Automobile Manufacturers’ Association are also concerned that European take-up of electric cars is not rising faster.
Sigrid de Vries, director general of ACEA, says:
“Battery-electric vehicles still account for just 15.6% of the EU car market. Not only is this well below the level where it needs to be at this point in the transition the share in unevenly distributed across member states.
To accelerate uptake, Europe must continue to expand public recharging infrastructure, secure lower recharging prices, and ensure well-coordinated purchase incentives schemes. The market data demonstrates why a technology-neutral approach must drive this transition.
EVs will lead the charge, but there must also be space for (plug-in) hybrids, range extenders, highly efficient internal combustion-engine (ICE) vehicles, hydrogen and decarbonised fuels.”
Introduction: Tesla sales fall 40% across Europe
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
Tesla’s European sales slump has continued, as it faces rising competition in the battery-powered electric car market.
New sales figures released by the European Automobile Manufacturers Association (ACEA) this morning show that Tesla shipments tumbled 40% last month. The company sold 8,837 vehicles across the European Union, the EFTA trade block and the UK in July, down from 14,769 in July 2024.
The sales slump, which began at the start of this year, continued despite the recent revamp of Tesla’s signature Model Y, indicating that the backlash against CEO Elon Musk’s political views could still be hurting the company.
Musk’s recent break-up with Donald Trump hasn’t, yet, revived the company’s fortunes. July’s 40% sales fall was worse than the total for 2025 to date, which are down 33% for the January-July period.
Tesla also faces rising competition, particularly from Chinese manufacturers. BYD, the Shenzhen-headquartered carmaker, more than tripled its sales year-on-year in July, up from 4,151 a year earlier to 13,503 last month, a rise of 225%.
This gave BYD a 1.2% market share, higher than Tesla’s 0.8%.
BYD, which overtook Tesla for European sales back in April, recently launched its Dolphin Surf EV car, which is priced from £18,650 in the UK.
ACEA also reports that in the first seven months of 2025, 1,011,903 new battery-electric cars were registered, accounting for 15.6% of the EU market share.
Hybrid-electric car registrations proved more popular, though, with 2,255,080 units sold across the EU so far this year. This was driven by growth in the four biggest markets: France (+30.5%), Spain (+30.2%), Germany (+10.7%), and Italy (+9.4%). Hybrid-electric models now account for almost 35% of the total EU market.
Overall, new car sales in Europe rose 5.9% in July, to 1.085 million.
The agenda
-
10am BST: Eurozone confidence data
-
1.30pm BST: US Q2 GDP (second estimate)
-
1.30pm BST: US weekly jobless claims