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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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