Tesla sales plunged 45% last month across Europe, where rival carmakers saw a surge in electric-vehicle (EV) demand.
The Elon Musk-led company registered only 9,945 cars in January, down from 18,161 a year ago, according to the European Automobile Manufacturers’ Association. EV sales soared 37 per cent for the overall industry, with carmakers posting big gains in Germany and the UK.
Tesla shares fell 6 per cent as of early morning trading on Tuesday in New York. The stock has tumbled 23 per cent this year.
Tesla is changing over production lines for by far its most popular vehicle, the Model Y SUV, and contending with its chief executive officer becoming an increasingly polarising figure in global politics. After emerging as a leading donor to Donald Trump during last year’s US election cycle, Mr Musk set his sights on Europe, backing far-right parties and attacking incumbents.
In addition to haranguing leaders in Germany and the UK, Mr Musk has joined Trump in disparaging Ukraine’s Volodymyr Zelenskiy and disputing polls that have found the president maintains support of the country’s people.
In response to Mr Trump’s criticisms, Mr Zelenskiy said last week the US president had fallen victim to Russian “disinformation.”
Tesla registered only 1,277 new cars last month in Germany, its lowest monthly total since July 2021. Sales in France plummeted 63 per cent in its worst showing there since August, 2022.
The company also registered fewer vehicles than China’s BYD for the first time ever in the UK. Tesla’s sales slumped almost 8 per cent in an EV market that grew 42 per cent last month.
YouGov conducted polls in Germany and the UK in mid-January that found Mr Musk was viewed unfavourably and that his meddling in the countries’ politics was unwelcome.
The Tesla chief executive hosted a live discussion with Alternative for Germany (AfD) party leader Alice Weidel on his social media site X on January 9th in an attempt to boost the anti-immigration, pro-Russian party that finished second in this week’s election.
During a virtual appearance at an AfD rally later in January, Mr Musk urged Germans to be proud of their culture and discouraged “too much focus on past guilt.” The comments touched a nerve just before the 80th anniversary of the liberation of the Auschwitz death camp.
Mr Musk also called for the imprisonment of UK prime minister Keir Starmer last month while advocating for the release of jailed far-right activists.
Tesla likely was dealing with shortages of inventory in some markets due to the all-out push the company made to boost sales late last year. Changing over assembly lines for the Model Y also may have had an effect on its January registrations.
Chief financial officer Vaibhav Taneja warned during last month’s quarterly earnings call that the transition to a new design for the model first introduced in 2020 would cost the manufacturer several weeks of lost production.
The company builds the Model Y at four plants globally, including at its factory outside Berlin.
The competition – led in Europe by Volkswagen, Stellantis and Renault – also is under greater regulatory pressure to sell more EVs in 2025. Manufacturers must meet stricter CO2 emissions targets in the European Union this year, while a steadily rising share of their sales need to be zero-emission in the UK by 2035. – Bloomberg
