Tesla Finally Broke Its 13-Month Losing Streak in Europe — But Don’t Pop the Champagne Yet
For the first time in over a year, Tesla actually sold more cars in Europe than it did in the same month a year ago. That’s the good news. The not-so-good news? Almost everything else about Tesla’s auto business is flashing yellow.
New data from the European Automobile Manufacturers Association shows Tesla’s EU registrations hit 13,740 units in February — up 11.8% from a year earlier. That snaps a brutal 13-month slide that had analysts openly wondering if the brand was becoming irrelevant on the continent. The stock nudged up about 1% on the news, which tells you how low the bar had fallen.
Here’s the problem: BYD’s European sales more than doubled over the same period. Both companies now sit at exactly 1.8% market share in Europe — meaning Tesla’s Chinese rival pulled even while Tesla was busy celebrating its first positive comp in over a year. That’s not a rebound story. That’s a “we stopped the bleeding just in time to watch our competitor lap us” story.
The broader EV market isn’t waiting around either. Battery-electric vehicle sales across Europe jumped 20.6% in February, and plug-in hybrids surged 32.1%. The pie is getting bigger — but Tesla’s slice isn’t growing with it. Wall Street has noticed: analysts have slashed their 2026 delivery growth forecast to just 3.8%, down from 8.2% at the start of the year. Some are now projecting a third consecutive year of declining global deliveries.
Morningstar’s Seth Goldstein specifically flagged the disappearance of U.S. EV tax credits and brutal overseas competition as headwinds. He noted tepid demand for Tesla’s stripped-down, lower-priced trims — the exact vehicles that were supposed to expand the addressable market. Meanwhile, Amazon’s Zoox just announced robotaxi expansions into San Francisco and Las Vegas, with Austin and Miami trials coming. Alphabet’s Waymo still owns the autonomous driving crown. Tesla’s own robotaxi ambitions remain mostly PowerPoint and promises.
Then there’s the regulatory wildcard. U.S. auto safety officials escalated their investigation into 3.2 million Tesla vehicles with Full Self-Driving last week, launching a formal engineering analysis that could lead to a recall. In Europe, Tesla is waiting on a Dutch ruling on FSD Supervised by April 10, with potential EU-wide clearance sometime this summer. Any delay threatens the one narrative — autonomy — that justifies Tesla’s premium valuation.
Tesla finished 2025 sitting on billion in cash, so it’s not going anywhere. But the stock trades on the promise of robotaxis and humanoid robots, not on selling sedans. The Europe rebound is a heartbeat, not a recovery. Investors cheering a single month of positive comps after 13 months of decline might want to ask themselves: if Tesla needs to celebrate not shrinking, what exactly are they paying 60x earnings for?
