Finally, a Little Good News for Tesla Investors -- or Is It?
Key Points
Good news: Tesla's European registrations had meaningful gains for the first time in a year.
Bad news: It was up against a brutally bad comparison, and year to date is roughly flat.
Tesla's Chinese rival, BYD, posted an incredible 165% gain in registrations in January compared to the prior year.
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When it rains, it pours, and Tesla (NASDAQ: TSLA) investors got soaked throughout all of last year. Tesla drove over numerous speed bumps that include declining vehicle sales, underutilized production capacity, reputational challenges surrounding CEO Elon Musk, an aging product lineup, price war pressures especially in China, and a cooling U.S. electric vehicle market, among others.
At first glance, Tesla's rebounding registrations in Europe appear like great news, but let's dig a little deeper, because it may not be all it's cracked up to be.
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What's going on?
Here's the good news: Tesla just posted its first meaningful year-over-year growth in Europe in over a year. Tesla registered 17,425 vehicles across 15 major European markets last month, a 10% increase compared to February 2025.
Here's the not-so-good news: Tesla's result in February 2025 was a fairly large disaster and a weak comparison. Investors probably hoped for a bit larger of a rebound this February, but it didn't fully materialize.
Dialing back to February 2025 for context, Tesla started the year off down significantly in registrations, partly due to the Model Y refresh limiting supply. Though Tesla quickly accelerated production to desired levels, it still couldn't catch 2024 full-year results because the Model Y refresh didn't drive significant new demand or order backlogs.
Image source: Tesla.
Tesla's particularly poor results in February 2025 didn't stop there, either, with Tesla's first-quarter 2025 European registrations crashing 37% compared to the prior year. Though it was a rough start, the automaker did manage to recover somewhat throughout the year, with 2025 registrations in Europe (excluding Poland) dropping a lesser 28% compared to 2024.
This is all important to note because Tesla's year-to-date registrations in Europe through February, are down 23 vehicles exactly -- from a brutal 2025 comparison that many media outlets considered a disaster.
What it all means
There are a couple of major points for investors to remember right now. Generally, Tesla's registrations are heavier toward the end of each quarter as larger shipments arrive from Tesla's Shanghai and Berlin Gigafactories, accelerating deliveries. In fact, during March 2025, Tesla registrations hit 28,478 in Europe, which was more than January and February combined.
Also worth noting, in fairness, is that Tesla's global rival, China's EV juggernaut BYD, opened 2026 in Europe with 18,242 in January alone, good enough for a 165% gain over the prior year. Chinese competition will only continue to intensify in the months and years ahead, as Tesla's grip on the market fades and its product ages.
In summary, that's all just context to better understand Tesla's 10% gain in Europe registrations last month. It is still a positive, and it is far better than continuing the previous 13 consecutive months of year-over-year declines that came before them. However, investors should make a mental note that this is far from a strong or secure rebound, and it may not get much better.
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Daniel Miller has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool recommends BYD Company. The Motley Fool has a disclosure policy.
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