### Tesla Faces Steep Sales Declines in Europe Despite Discounts

Tesla's European sales are plunging, even with the introduction of the new Model Y and record-setting discounts. Norway stands as a rare bright spot for the automaker, but its performance there might be fleeting and unimpressive compared to the overall trends in Europe.

New data from May reveals that Tesla's sales are in significant decline across several key European markets. Countries like Belgium, Spain, Sweden, Denmark, and others reported lower sales figures, extending the downward trajectory seen throughout the year. France, in particular, showcased a dismal performance in May, performing even worse than the already challenging first quarter. The only exceptions to this trend are Norway and Austria, which have not experienced the same declines.

Tesla has avoided commenting on its falling sales in these struggling markets. However, the company was quick to highlight its surprising uptick in Norway. Although Tesla reported a 213% increase in Norwegian deliveries, this spike is compared to a notably poor May 2024 for the company, suggesting the improvement might not be as substantial as it appears at first glance.

Comparison of Tesla's deliveries for the second month of each quarter over the past two years shows that May 2024 was an especially bad month, making the recent gains look more impressive. Yet, it is undeniable that Tesla has recovered some ground in Norway, thanks in part to unprecedented discounts, including zero-interest financing on the new Model Y. Despite similar incentives being offered across Europe, other markets have not responded as favorably.

As more data from May comes in, it becomes clear that Tesla's Q2 deliveries in Europe could fall even further below the company’s already poor Q1 performance. Initially, Tesla attributed these struggles to the Model Y changeover. Now, the continuous decline indicates deeper issues.

Even as 2,500 Norwegians bought Tesla vehicles in May, this surge is insufficient to offset the declines in other European markets. This brief uptick may also be unsustainable, especially if Tesla drops the zero-interest financing at the end of the quarter as planned. To regain its footing in Europe, it appears Tesla needs more than discounts; it requires a refreshed EV lineup with smaller, more affordable models and a strategic shift away from its embattled CEO's unfulfilled promises on autonomy.

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