
Sales of European Cars Increase in July and BYD Overtakes Tesla
BYD Overtakes Tesla. In contrast with the general business and economic conditions across the region in the July -2024 report, the European auto market showed renewed signs of resilience as new registrations increased 5.9% year on year as released by the ACEA. This renewed growth was stemmed by a sharp increase in double digit growth from Germany, alongside the UK, France and Italy.
However, one of the essential and most startling successes and achievements concerning the increase in sales of electric vehicles all over Europe continuing to demand new electric vehicles (EVs and heat vehicles ) was BYD’s recently made anouncing which as with all the spying and concern from all over the old continent as widely reported that they have increased the market of electric cars fighters in Europe and it was China BYD for the first time which gained over Tesla in the European stock market.
The Numbers Game: What July Reported
In July the European Union and the rest of Europe together reached a sale of 1.09 million vehicles. The regained sales stepped up in demand due to the slow and lethargic summer.
Germany: the fastest to increase sales 11.1% from the previous year.
Spain: sales increased by 17.1% due to a hike in car fleets and with a high market in demand of cars seeking to be rented.
Poland: an increase of 16.5% could be seen in the sales of cars in the hands of the middle class.
Austria: had the fastest increase of an astounding 31.6%.
France, Italy, and the UK: All three countries reported declines ranging from -5% to -7.7% and this negatively impacted the wider EU performance.
On the manufacturing side, results were mixed:
Volkswagen Group: +11.6% due to the new ID. series EVs.
Renault: +8.8% due to strong sales of hybrids and budget EVs.
Stellantis: -1.1% due to weak sales of Peugeot and Fiat.
However, the EV sector truly differentiated itself. Registrations of electric and hybrid vehicles soared:
Battery EVs: +39.1%
Hybrid electrics: +56.9%
Plug-In hybrids: +14.3%
Collectively, these categories accounted for 59.8% of all registrations, a sharp increase from 51.1% in July 2024. This marks a decisive turning point, demonstrating that Europe’s electrification efforts are now fully integrated, transcending the realm of aspirations.
Tesla’s European Challenge
For Tesla, the July figures represent a continued shrinkage of its European foothold. Sales were down 40.2% YoY, resulting in a market share decrease to 0.8% from 1.4% a year prior.
Tesla was the undisputed champion of EV adoption throughout Europe. They dominated the sales charts with their Model 3 and Model Y vehicles from 2020 to 2022 due to strong brand loyalty and the advantages of being a first mover. But mid-2025 is seeing the first real shifts.
Most notable reasons for the Tesla drop:
- Aging Product Lineup: Tesla’s roster has not expanded since launching the Model Y in 2021, leaving the automaker’s lineup looking stale next to competitors.
- Price Pressure: Increasing competition from Chinese manufacturers has Tesla on the defensive.
- Competition from European Hybrids: Tesla has no presence in the hybrid electric vehicle market.
- Production Bottlenecks: The Berlin Gigafactory has experienced repeated workflow stagnation.
- Perception Shifts: Brand controversies and Elon Musk’s public image issues have hurt Tesla’s reputation.
BYD’s Surge: A New Force in Europe
BYD’s market share of 1.2%, while still small, surpassing Tesla’s serves as a symbolic shift, growing 225.3% year-on-year in July.
BYD, a Chinese automaker and battery company founded in 1995, has shifted the market as a vertically integrated company by producing their own batteries, chips and EV components, garnering the title of a cost efficient rival.
BYD’s European Strategy
- Cost-Effective Options: BYD’s Atto 3 and Dolphin EVs provide value well under the price of Tesla and most European brands.
- Strategic Growth: Plans for a Hungarian assembly plant provide a strategically located production foothold.
- Enhanced Visibility: Collaboration with dealerships and rental companies bolsters BYD’s presence.
- Political Concerns: Despite EU tensions, some members embrace Chinese EVs to meet green transition goals.
European Automakers: Between Concentration and Competition
For the legacy giants, July provided some relief, while Volkswagen, Renault, Stellantis, BMW, and Mercedes remained cautious.
The industry has had to face:
- Loss of confidence: Leading to reduced earnings forecasts for 2025.
- Multi-Billion Losses: EV development programs hurt balance sheets.
- Compliance Pressure: Stricter EU carbon regulations demand faster adaptation.
- Stellantis: Struggling to increase EV adoption.
Policy, Politics, and Pressure
The EU Climate Policy dictates that all new vehicles must achieve a 100% reduction in CO2 emissions by 2035. Industry leaders are pushing back, citing feasibility issues.
Europe 2025: Prioritizing Consumers
European consumers are clearly prioritizing low-cost electrification with increased flexibility. Hybrids are more accessible, cities with charging infrastructure see faster adoption, and premium buyers gravitate toward German luxury hybrids.
Global Trade Tensions: The Shadow Over Europe
Trade wars are creating complications. The US increased tariffs on Chinese EVs, while Europe debates similar measures. Dependence on Chinese supply chains for lithium-ion batteries and rare earths leaves Europe vulnerable.
Looking Ahead: A Market at a Crossroads
Analysts predict EVs will exceed 65% of registrations by 2026. Tesla risks being sidelined without new models. Chinese automakers could capture 10–15% of the EU market by 2030. European carmakers may be forced to merge or partner to survive.
Conclusion: A Turning Point

The July 2025 sales increase will likely be overshadowed by Tesla’s decline and BYD’s rise. With environmental policy and economic competition colliding, the next decade will be chaotic but innovative. The EV contest is no longer Tesla vs Volkswagen—it’s now fully claimed by BYD in a three-way battle.
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