Last month, BMW surpassed Tesla in sales and took the lead in the European electric vehicle market for the first time. The German automaker is experiencing a rapid increase in sales amidst challenges faced by other manufacturers.
According to Jato Dynamics, sales of fully electric BMWs in the EU skyrocketed by over a third in July, reaching 14,869 units. Meanwhile, Tesla's sales decreased by 16% to 14,561 units.
Although Tesla is still the top seller of electric vehicles year-to-date, it is losing market share in Europe to companies like BMW and Volvo. Last month, European car buyers registered a total of 139,300 new electric vehicles, which is about 6% less than the same time last year.
The demand for electric vehicles in Europe is cooling off after countries like Germany and Sweden halted or reduced subsidies. This has prompted automakers to scale back their electric vehicle ambitions. Volkswagen, the largest automaker in the region, announced this month that it is reducing capacity at its factories in Germany and noted that it may delay the release of new electric models. Mercedes-Benz is backing away from its electrification plans and battery initiatives.
“The lack of clarity regarding incentives — and the future of electric vehicles — continues to be a barrier for consumers,” said Jato Dynamics analyst Felipe Munoz. “These factors, along with the low residual value of electric vehicles, contributed to the decline seen in July.”
BMW has managed to withstand this trend due to high demand for electric vehicles, including the i4 and iX1, which outperformed the sales of similarly sized Mercedes and Audi models. The Tesla Model Y retained its status as the best-selling electric model in Europe in the first half of the year, although demand for the four-year-old model is declining, with sales dropping by 16% in July.
Chinese car manufacturers led by BYD and SAIC Motor have been gradually expanding their operations in Europe this year, but EU tariff threats have slowed their momentum. To circumvent tariffs, Chinese automaker Dongfeng plans to open a factory in Europe.
Source: bloomberg
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