Tesla encounters Waterloo: European market sales drop to a 15-month low
Tesla's sales in the European market were sluggish in the second quarter, with a year-on-year decrease of 2.3%, marking the worst performance since January 2023. Meanwhile, electric vehicle sales in Europe increased by 14%. Tesla expects the performance in the European market to improve in the coming months. However, countries like Germany and Sweden have stopped or canceled electric vehicle subsidies, affecting sales growth in the European market. Manufacturers such as Volkswagen and Mercedes-Benz are also reconsidering their product plans. Tesla's sales in Germany and the UK have also declined
According to the Zhitong Finance and Economics APP, Tesla (TSLA.US) had a slow start in the European market in the second quarter, but CEO Musk expects the performance in the European market to be much better than the previous months this year.
The European Automobile Manufacturers Association stated on Wednesday that the automaker registered only 13,951 vehicles in April, a 2.3% decrease year-on-year, marking the worst record since January 2023. In contrast, electric vehicles in the industry grew by 14% in the same month.
Tesla also reported a decrease in shipments from its Shanghai factory in the same month, contrasting with the strong growth in the broader Chinese plug-in electric vehicle industry. On April 23, Musk told investors that the company expects to recover from several issues that affected first-quarter production, including interruptions in ocean shipping and a fire incident halting production at the German factory.
Musk stated during Tesla's first-quarter earnings call, "We think the second quarter will be much better."
In recent months, countries including Germany and Sweden have stopped or canceled electric vehicle subsidies, hindering sales growth in the European market. Meanwhile, manufacturers like Volkswagen (VWAGY.US) and Mercedes-Benz have been reconsidering their product plans, with Volkswagen preparing to produce more plug-in hybrid vehicles and Mercedes-Benz continuing to produce fuel cars until the 2030s.
Despite efforts by most brands in Germany, the largest car market in Europe, to cope with the cancellation of incentives, Tesla's performance last month lagged behind its peers. In Germany, overall electric vehicle registrations remained stable, while Tesla's sales plummeted by 32%.
In the UK, Tesla's registrations also dropped by 25% in April, marking a 14% decline in the first four months of this year