In January 2025, Tesla's sales in Europe took a sharp dive, recording a mere 9,945 registrations. This marked a steep 45% year-on-year decline, occurring despite a continent-wide surge in electric vehicle sales by 37%. According to the European Automobile Manufacturers Association, Germany and the UK led the growth in electric vehicle sales, yet Tesla's performance in these markets suffered significantly, with sales dropping by 59.5% and nearly 18%, respectively.

Analysts pinpoint several factors contributing to Tesla's sales downturn, including heightened competition within the European market, the gradual phasing out of subsidy policies, consumers' anticipation of the new Model Y, and the public perception surrounding Elon Musk.