Tesla sales slumped 40% across Europe in July compared with a year earlier as Elon Musk’s electric car company faces increasingly tough competition from its Chinese rival BYD.
There were 8,837 sales of Tesla cars last month across the EU, the European Free Trade Association and the UK, according to figures from the European Automobile Manufacturers’ Association (ACEA). That compared with 14,769 at the same point last year.
New car registrations for BYD across Europe rose to 13,503 last month, compared with 4,151 a year earlier. BYD now has 1.2% market share, the ACEA found. Tesla’s share remains at 0.8%.
Chinese car brands, which often have relatively cheaper models, have been expanding aggressively in Europe. BYD outsold Tesla in Europe for the first time this spring, according to a report from the market research company JATO Dynamics.
In the UK the government said on Thursday that the US car brand Ford would be the first manufacturer to receive the maximum £3,750 subsidy on two models: the Gen-E and the e-Tourneo Courier. A further 26 other models will be eligible for grants of £1,500 under the government’s new electric car grant scheme.
The grants apply only to vehicles with a list price of £37,000 or below. The discount is applied automatically at the point of sale.
Heidi Alexander, transport secretary, 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.”
Separately, the Society of Motor Manufacturers and Traders said UK car production rose for a second month in a row in July, by 5.6%.
However, the SMMT chief executive, Mike Hawes, said it was a turbulent time in the market, with “consumer confidence weak, trade flows volatile and massive investment in new technologies under way both here and abroad”.
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ACEA also reported that in the first seven months of 2025, 1.011m new battery-electric cars were registered, accounting for 15.6% of the EU market share.
Hybrid-electric car registrations proved more popular, with 2.255m units sold across the EU so far this year. The rise was driven by growth in the four biggest markets: France, up 30.5%, Spain, up 30.2%, Germany, up 10.7, and Italy, up 9.4%.
Sigrid de Vries, director general of ACEA, said that to accelerate uptake Europe “must continue to expand public recharging infrastructure, secure lower recharging prices, and ensure well-coordinated purchase incentives schemes”.