Tesla’s sales in Europe dropped once again in May, marking the fifth consecutive monthly decline and signaling that the backlash against Elon Musk has yet to subside. According to data released Wednesday by the European Automobile Manufacturers Association, Tesla registrations fell by 28% across 30 European countries, even as the overall electric vehicle (EV) market posted notable growth.
The slump dealt a blow to investors who had been banking on a rebound following Musk’s recent promises. Last month, the Tesla CEO forecasted a “strong recovery,” sparking renewed enthusiasm on Wall Street. However, on Wednesday, investors began selling off shares, pushing Tesla’s stock down by more than 4% in early afternoon trading.
The company had expected a boost after completing factory retooling to produce an updated version of its best-selling Model Y. But that transition wrapped up months ago, and the new models are already widely available. Now, investor hopes rest on a more affordable Tesla, expected to launch later this year, as a potential game-changer to reverse declining sales.
Meanwhile, the EV market as a whole continues to surge. Battery electric vehicle sales jumped 25% year-over-year in Europe, with Germany showing particularly strong performance. Ironically, that growth comes despite Musk sparking controversy there by publicly supporting the far-right, anti-immigration party Alternative for Germany (AfD) ahead of recent elections. EV sales in Germany rose by 45%.
The biggest winner of the month was China’s SAIC Motor, which saw its European sales of electric and combustion vehicles rise by 38%. That growth allowed the company to overtake Tesla in the regional rankings — a stark shift from just a year ago, when the American automaker led the market.
This commercial setback comes at a pivotal moment for Tesla, which recently launched a pilot of its much-anticipated driverless robotaxi service in Austin, Texas. Musk stated that if the trial goes well, he expects to expand quickly to other cities, aiming to have up to one million autonomous taxis on the roads by year’s end.
While early reviews have been mostly positive, the test program remains limited: just a dozen vehicles are currently operating. Some users have posted videos highlighting concerning issues, including one showing a robotaxi driving the wrong way down a traffic lane.
