Investing.com - Tesla’s European sales slumped just over 40% in February as the electric car maker grappled with tough competition and growing ire towards the political activities of CEO Elon Musk.
Sales of the battery-electric vehicle brand in the European Union, the European Free Trade Association, and the U.K. slid by 40.1% year-on-year in February to 16,888 units. So far this year, the figure has dropped by 42.6%.
The company’s market share in the region also shrank to 1.8% from 2.8% a year earlier, data from the European Automobile Manufacturers’ Association showed on Tuesday.
Tesla’s weak February sales came even as overall battery electric vehicle (EV) registrations in Europe grew 26.1% year-on-year in February, with Tesla (NASDAQ:TSLA) rivals such as China’s SAIC clocking strong growth for the month.
Battery EVs also made up the third-largest component of European automobile sales in the January-February period, at a 15.2% market share. Hybrid EVs continued to dominate with a 35.2% market share. Petrol cars held a 28.6% share.
Tesla’s sales drop still came against the backdrop of a softer European car market, with overall new vehicle registrations falling 2.6% year-over-year in the month. But majors such as Volkswagen (ETR:VOWG_p), Renault (EPA:RENA), and BMW (ETR:BMWG), all notched stronger sales.
A host of challenges faces Tesla in Europe, including an ageing slate of offerings compared to newer -- and cheaper -- Chinese entrants. Tesla is gearing up to launch an updated version of its best-selling Model Y mid-size SUV, with a Reuters report saying the firm could slash the new model’s price by 20% to help bolster lagging sales.
Menawhile, controversy has swirled around Musk, who has sought to promote far-right parties in Europe. Musk’s ties to U.S. President Donald Trump have also sparked outrage in recent weeks. Tesla vehicles, showrooms, and facilities have been targeted by protests and vandalism across the U.S. and Europe in March.
Outside of the region, Tesla has also been dented by weak demand in major markets such as North America and China. Musk recently appeared at an all-hands meeting of the EV maker, calling on employees not to sell their stock holdings.
Tesla’s shares, which have dropped by more than 26% year-to-date, were slightly lower in premarket US. trading on Tuesday.
(Ambar Warrick and Reuters contributed reporting.)