While reporting on monthly sales data for a single car manufacturer in one market isn’t our usual practice, Tesla’s latest performance warrants attention amidst global events. The company is facing significant challenges in Europe, as it experienced a dramatic 49 percent decline in sales across the EU, UK, and European Free Trade Association in April compared to the previous year, all while the market for battery-electric vehicles continues to expand.
Recent statistics from the European Automobile Manufacturers Association show that Tesla recorded just 7,261 new vehicle registrations in April, nearly half of what it achieved in the same month last year. This dip is particularly striking given the recent launch of the updated Model Y—a revision of their best-selling model that was anticipated to draw in new customers. Unfortunately, the strategy appears to have backfired up to this point.
Despite Musk’s upbeat comments regarding the Model Y’s sales potential, Tesla seems to be facing a worsening brand crisis. This trend is not due to a growing disinterest in electric vehicles among European consumers; in fact, battery-electric car sales surged by 26.4 percent in the first four months of 2025, totaling 558,262 units and capturing 15.3 percent of the EU market share.
Despite Musk’s optimistic talk about the Model Y’s sales prospects, Tesla’s brand crisis appears to be deepening.
Various factors contribute to Tesla’s declining performance, such as increasing competition from local manufacturers and Chinese firms, alongside Musk’s controversial efforts to reduce federal spending during the Trump administration through the Department of Government Efficiency (DOGE). His political endorsements, particularly his support for Germany’s far-right party prior to elections, have not favored Tesla’s standing in the region.
Musk appears to recognize the negative impact of his political engagements on Tesla’s fortunes. He has stated his intention to spend less time in Washington and concentrate more on his company, though he also mentioned that he would continue to be involved with Trump’s administration until its term concludes.
While his previous alignment with Trump excited Republican supporters, general sentiments towards Musk are waning. A recent Reuters/Ipsos poll indicated that 58 percent of those surveyed held an unfavorable view of him, compared to just 39 percent who viewed him positively. This close association with his ventures seems to have backfired, with a reputation survey placing Tesla 95th and SpaceX 86th, a significant drop from their positions of 8th and 5th just four years ago.
During the recent quarterly earnings call, Musk expressed confidence that Tesla’s sales would rebound after the updated Model Y’s manufacturing transitions. However, with the CEO increasingly preoccupied with AI, robotics, and self-driving technologies, it’s uncertain if there are any immediate solutions to the growing challenges facing Tesla.
