European Tesla sales continue downward trend in March

Tesla's sales in key European markets fell again in March, data showed on Tuesday, adding to signs that drivers are shunning Elon Musk's electric car brand as competition from China stiffens and some protest against his political views.

New Tesla sales in France and Sweden dropped for a third consecutive month, contributing to its lowest first-quarterly sales figures in the two countries since 2021.

Billionaire CEO Musk, a close ally of US President Donald Trump, has stirred controversy by courting far-right parties in Europe, adding to Tesla's sales slump ahead of the much-anticipated launch of its new Model Y mid-size SUV.

“Never has a car brand suffered such a global fall from grace,” said Quentin Willson, founder of British EV campaign group FairCharge and a Tesla owner.

Analysts expect data from Spain and other European markets on Tuesday to provide more clues on the group's global first-quarter delivery figures, to be released on Wednesday, and consumer sentiment towards the brand.

Tesla registered in March 3,157 car sales in France, 911 in Sweden and 2,211 in Norway, dropping respectively 36.83%, 63.9% and 1% from last year, official data showed.

In Denmark, registrations totalled 593, down 65.6%, and they fell by 61% to 1,536 in the Netherlands.

Quarterly sales were down 41.1% in France, 55.3% in Sweden, 12.5% in Norway, 56.4% in Denmark and 49.7% in the Netherlands.

The group's market share in France dropped to 1.63% in the quarter ending March. It lost ground to brands grouped as “others” by national car body PFA. These include BYD and other Chinese EV makers, and saw their share rise to 3.19%.

Portugal bucked the trend, with Tesla registrations up 2% on the month, but they dropped 26% in the quarter, despite an accelerating electrification trend in the market.

Tesla has a number of challenges in Europe. It has a small, ageing line-up while traditional carmaker rivals and new Chinese entrants are launching new, often cheaper EVs.

“Tesla's weak numbers in Europe are the result of a combination of factors,” said Ben Nelmes,  CE of research group New AutoMotive. “The company has failed to develop models that can compete on price. On top of this, the CEO's involvement in US politics is alienating many consumers.”

Musk's support of far-right parties in Europe, including for Germany's AfD that came second in February's national elections, also appears to have hurt Tesla's sales on the continent.

“In the US, the strategy would be to leverage, would be to tie to patriotism and shift to the Right,” said Eric Schiffer, CE of private equity firm the Patriarch Organisation in Los Angeles. “The European strategy is going to be more challenged and will need to be more about the value and competitive differences with the market there”, he said.

In response to Musk's right-wing activism, Tesla cars have become targets for vandalism in several countries, while “Tesla Takedown” protests are planned across Europe and the US.

On Monday Musk said an overnight fire at a Tesla dealership in Rome that destroyed 17 cars was an act of terrorism, reiterating earlier comments by Trump.