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EU Car Sales Rise as Chinese EV Makers Gain Ground, Tesla Loses Market Share
New car registrations in the European Union climbed by 7.4% in July compared with the same month last year, driven in part by growing demand for electric vehicles (EVs). However, Tesla’s position in the bloc is weakening as Chinese manufacturers, particularly BYD, expand their presence at a rapid pace.
According to figures released by the European Automobile Manufacturers’ Association (ACEA), Tesla’s sales in the EU fell sharply in 2025. Between January and July, sales declined by 43.5% year-on-year, while July alone saw a drop of 42.4%. Analysts link this slump to reputational challenges following CEO Elon Musk’s entry into U.S. politics and subsequent role in the American government.
In contrast, Chinese rival BYD has surged. The automaker more than tripled its sales during the first seven months of the year and posted a 200% increase in July alone. BYD captured 1.1% of the EU car market in July, surpassing Tesla’s 0.7%. Over the January–July period, BYD’s market share reached 0.9%, up from just 0.3% a year earlier, while Tesla’s dropped from 2.1% to 1.2%.
SAIC Motor, another Chinese manufacturer that owns brands including MG, IM Motors and Roewe, has also made steady inroads. Its sales grew by more than 30% between January and July, securing a 1.9% market share in the EU.
The figures highlight the growing competitiveness of Chinese EV makers in Europe, where affordability and technology are helping them close the gap with established Western brands.
Across the bloc, battery electric vehicles accounted for 15.6% of new car registrations in the first seven months of 2025, up from 12.5% in the same period last year. Growth, however, varied significantly between countries. Germany, the EU’s largest car market, recorded a 38.4% rise in EV sales during the period, while Spain posted a remarkable 89.6% increase. Italy’s EV sales climbed 29%, and the United Kingdom, which is no longer an EU member but remains a key market, saw growth of 31%. France was the only major market to decline, with EV sales down 4.3%.
Despite the July surge, overall EU car registrations fell by 0.7% in the first seven months of the year compared with 2024. Hybrid-electric vehicles remained the dominant powertrain choice, securing a 34.7% share of the market, underscoring the technology’s continued popularity as a bridge between traditional combustion engines and fully electric models.
With consumer demand for greener transport rising, competition in the EV sector is intensifying. While Tesla retains a notable presence, its shrinking market share and the rapid growth of Chinese automakers suggest a significant shift in Europe’s automotive landscape is underway.
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EU Must End ‘Naivety’ on Trade and Confront China’s Industrial Strategy, Says French Minister
France’s Minister for Foreign Trade, Nicolas Forissier, has called on the European Union to abandon what he described as “naivety” in its approach to global trade, urging a tougher stance on countries accused of distorting markets through industrial policy and trade practices.
Speaking in an interview with Euronews’ 12 Minutes With programme, Forissier said Europe must respond more firmly to what he described as the weaponisation of trade dependencies, warning that China in particular could damage its own long-term interests by undermining European industry.
“The Chinese have to understand that they won’t win anything if they destroy the European industry and then the European market, which is an essential market for them,” he said. “We must no longer be naive.”
His comments come as the European Commission prepares to hold an “orientation debate” next week on how to respond to a surge of low-cost Chinese imports. The discussion is expected to shape possible new trade defence measures, with further talks likely when EU leaders meet in Brussels in mid-June.
Forissier said the shift in thinking was not limited to China alone but applied to any country using commercial leverage to gain strategic advantage. “It is not only China,” he said. “It is all the countries that weaponise trade.”
Among the proposals under consideration is a requirement for EU companies to diversify supply chains, sourcing components from at least three different suppliers in order to reduce dependency on any single foreign market. Asked whether he supported such a measure, Forissier replied: “Yes, we have to.”
Other options include targeted tariffs on sensitive industries such as chemicals, alongside stronger use of anti-dumping and anti-subsidy tools to counter imports priced below domestic market levels. These measures are designed to address concerns over overcapacity in China’s industrial sector and its impact on European manufacturers.
The debate is taking place against a backdrop of widening trade imbalances. EU goods imports from China exceeded exports by €359.3 billion in 2025, marking an increase of nearly 20% compared with the previous year.
China has already warned it could retaliate if the bloc imposes new restrictions, raising concerns about potential escalation in trade tensions between two of the world’s largest economies.
France has repeatedly pushed for a more assertive European trade policy, arguing that state subsidies, export controls on raw materials and industrial overproduction in major economies are distorting global markets.
Forissier stressed that Europe must maintain open dialogue with Beijing while defending its own industrial base. “We try to respect the Chinese,” he said. “The Chinese have to respect us, and this is the message European institutions have to send.”
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