Tesla’s sales in Europe fall to a 15-month low

Chief executive Elon Musk was expecting a much better showing than the first few months of the year. Pic: AP Photo/David Zalubowski, File

Tesla got off to a sluggish start to the second quarter in Europe, where chief executive Elon Musk was expecting a much better showing than the first few months of the year.

The carmaker registered just 13,951 vehicles in April, the European Automobile Manufacturers’ Association said, down 2.3% from a year ago and its worst tally since January 2023. Tesla was an exception in an otherwise encouraging month for battery-electric vehicles, which rose 14% industrywide.

Tesla similarly reported a downturn in shipments from its Shanghai factory for the month, in contrast with strong growth for China’s broader plug-in car industry. 

Mr Musk told investors on April 23 that the company expected to bounce back from several issues that affected production in the first quarter, including Red Sea shipping disruptions and the suspected arson of power lines near its German sport utility vehicle plant.

“We think Q2 will be a lot better,” Mr Musk said during Tesla’s first-quarter earnings call.

Countries including Germany and Sweden have ceased or dialled back EV subsidies in recent months, which has put a damper on Europe’s sales growth. Manufacturers including Volkswagen and Mercedes-Benz have meanwhile been rethinking product plans, with VW preparing more plug-in hybrids and Mercedes keeping combustion cars in production well into the 2030s.

While most brands have struggled with the pullback of incentives in Germany — Europe’s biggest car market — Tesla underperformed peers last month. Overall EV registrations were broadly flat, whereas Tesla’s sales plunged 32%.

In the UK, Tesla registrations fell 25% in April and have slumped 14% in the first four months of the year.

Meanwhile, China signalled it’s ready to unleash tariffs as high as 25% on imported cars with large engines, as trade tensions escalate with the US and EU.

The China Chamber of Commerce to the EU said it was informed about the potential move by “insiders,” according to a statement posted on X. The levies would affect European and US carmakers and have a “significant” impact on relations with the EU, it added.

Beijing is ramping up threats of retaliation as a deadline looms for the EU to announce results of its probe into China’s electric-vehicle subsidies. The eurozone must inform Chinese exporters whether it intends to impose tariffs by early June, and they could go into effect a month later, according to Eurasia Group.

- Bloomberg