The automotive industry is currently grappling with various challenges, including a slight decline in electric vehicle sales. Tesla’s Model Y remains the top seller in Europe, but registrations have dropped significantly. In contrast, Volkswagen has seen a remarkable recovery with substantial sales increases for its ID. models, overtaking Tesla as the leading electric manufacturer in Europe. New entrants like Kia and Renault are also gaining traction, contributing to a 26% rise in electric vehicle sales in February 2025.
The Current State of the Automotive Market
The automotive industry is facing significant challenges right now. Contrary to popular belief, the downturn is not exclusively due to electric vehicles. However, it’s undeniable that the electric car sector is feeling the impact, with a slight decline in sales during the previous year. Notably, different manufacturers are experiencing varied outcomes in this turbulent market.
Tesla’s Sales Performance Amidst Challenges
Recent data from Automotive News for January and February 2025 reveals that the Tesla Model Y continues to dominate electric vehicle sales in Europe, tallying 14,773 units sold during this timeframe. While this secures its position at the top, the situation is far from ideal. Registrations for the Model Y have plummeted by an alarming 53.1% compared to the same period in 2024.
This statistic underscores the serious challenges facing the American automaker, which is currently experiencing a notable sales decline. Factors contributing to this downturn extend beyond Elon Musk’s controversial remarks. Additionally, the Model 3, ranking sixth in electric vehicle sales, has also seen a drop, with only 10,071 units sold this year—a decrease of 26% from 2024.
In February alone, Tesla’s overall sales dropped by 44%, a trend that may persist in the months ahead. However, not all automakers are struggling; some are even witnessing unexpected growth.
Volkswagen’s Remarkable Recovery
Volkswagen, while not immune to the crisis—having announced over 35,000 job cuts due to disappointing electric car sales in 2024—has shown remarkable improvement since the start of 2025. Their ID.4 and ID.7 models recorded astonishing increases in registrations, soaring by 172% and 821%, respectively. This surge has resulted in the ID.4 selling 13,812 units, while the ID.7 attracted 11,303 customers, far surpassing the Model 3’s performance.
The Volkswagen ID.3 is also thriving, with 10,785 units sold, reflecting a 141% increase in sales. Consequently, Volkswagen’s electric vehicle registrations have surged by an impressive 182%, enabling the brand to claim the title of “number 1 electric manufacturer in Europe” from Tesla.
Additionally, new competitors are entering the market, eager to carve out their space in Europe. The Kia EV3, launched in 2024, has captured attention with 11,271 units sold. Moreover, the Renault 5 E-Tech, which was the top-selling electric vehicle in France in November 2024, has gained traction with 9,012 sales. Following closely is the Citroën ë-C3, with 8,142 units sold in 2025.
Encouragingly, electric vehicle sales in Europe have surged by 26% in February 2025 and by 30.6% in the first two months of the year, reinforcing predictions from experts that 2025 could be a breakout year for electric vehicles. This growth can be attributed to the introduction of more affordable models, along with the increasing influence of Chinese manufacturers like MG and BYD, whose sales are rapidly climbing in Europe.