By Iain Rogers, Bloomberg
Tesla Inc.’s recovery in Europe accelerated last month, increasing pressure on rivals like Volkswagen AG that are also grappling with rising competition from Chinese manufacturers.
Tesla registrations in the region more than doubled in May, bolstered by strong growth in markets including Germany and the UK, the European Automobile Manufacturers’ Association said Tuesday. They were up by 57% from a year earlier in the first five months of 2026.
Demand for Teslas slumped across most of Europe last year, in part due to the backlash over Chief Executive Officer Elon Musk’s support for the continent’s extremist parties and his ties with US President Donald Trump.
The fallout appears to be dissipating in part thanks to a new incentive program for zero-emission vehicles worth €3 billion ($3.4 billion) introduced by the German government, which is among those Musk has campaigned against on social media.
As well as EVs, the subsidies also apply for plug-in hybrids and cars with range extenders, part of a broader effort to support the nation’s auto sector, which employs around 700,000 people.
Tesla, which has a plant in Brandenburg near Berlin, posted a more than fourfold increase in new registrations in Germany in May compared with a year earlier, according to the KBA Motor Transport Authority.
Musk stirred up the campaign for Germany’s election last year when he proclaimed that the only political force that could save Europe’s biggest economy was the far-right AfD.
The anti-immigrant party ultimately came second to Chancellor Friedrich Merz’s conservative bloc in the February 2025 ballot but has since climbed to first place in most polls.
According to consulting firm EY, Tesla’s Model Y sport utility vehicle and Model 3 sedan were the best-selling EVs across western Europe last month.
The Elroq and Enyaq models from Skoda — part of the Volkswagen group — were in third and fourth place respectively, followed by VW’s ID.3 and the T03 made by China’s Leapmotor.
“Chinese car manufacturers are slowly but surely gaining market share in Europe,” EY said. “Inexpensive Chinese models are real bestsellers, especially in southern European countries.”
–With assistance from Rafaela Lindeberg and Stefan Nicola.
(Updates with details on German sales starting in fourth paragraph.)
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