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Is Tesla's Model Y Driving a Lasting Recovery in Europe?
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Key Takeaways
Tesla registrations surged in May across France, Denmark, Spain, Sweden and Norway.
Tesla posted a record May in France with 5,446 registrations, up 655% year over year.
Tesla is benefiting from Model Y demand and growing EV adoption across Europe.
Tesla’s (TSLA - Free Report) recovery in Europe gained momentum in May, as the electric vehicle maker recorded strong year-over-year sales growth across several major markets and achieved a record-breaking May performance in France.
Per the data published by various European automotive associations, Tesla registrations rose substantially in France, Denmark, Spain, Sweden and Norway compared with the same period a year earlier. The figures indicate that Tesla’s turnaround in Europe, which started earlier this year, is continuing to build after a challenging 2025.
France posted the strongest growth. Tesla registrations in the country reached 5,446 vehicles in May, up 655% year over year. The result represented Tesla’s highest-ever May sales in the country and ranked among its best monthly performances in France overall.
In other markets, Tesla registrations jumped 136% year over year to 1,750 vehicles in Denmark and surged 113% to 1,690 units in Spain. Sweden recorded a 71% increase to 858 registrations, while Norway, one of Tesla’s largest global markets, saw registrations rise 29% year over year to 3,345 vehicles.
Although the growth partly reflects easier comparisons against weaker results in 2025, Tesla is also benefiting from stronger demand for the updated Model Y. Last year, production of the vehicle was temporarily affected as factories shifted to manufacturing the refreshed version. The Model Y remains Tesla’s best-selling vehicle in Europe. In Sweden, it accounted for more than 670 of the company’s 858 registrations, while the Model 3 contributed roughly 185 units. Deliveries of the Model S and Model X remained relatively limited.
Tesla is also benefiting from favorable trends in the broader European EV market. Data from the European Automobile Manufacturers’ Association showed that registrations of electrified vehicles, including battery-electric, plug-in hybrid and hybrid models, rose about 21% in April and made up more than two-thirds of all new vehicle registrations across Europe.
Rising EV adoption, supportive government incentives and elevated fuel prices continue to drive consumers toward electric vehicles and away from conventional internal combustion engine cars across many European markets. TSLA carries a Zacks Rank #4 (Sell) at present.
Key Expansion Strategies of Tesla’s Peers in Europe
General Motors Company (GM - Free Report) exited its large traditional European business after selling Opel and Vauxhall in 2017. Its current strategy focuses on re-entering Europe's EV market through premium brands like General Motors and Cadillac, targeting higher-margin customers with models such as the Lyriq while expanding Cadillac’s sales and service network.
Ford Motor Company (F - Free Report) considers its commercial vehicle unit, Ford Pro, as its primary growth driver in Europe. Alongside its leadership in the van market, the company is expanding software, fleet management and connected services, while planning to launch seven new models by 2029, including EVs, hybrids, crossovers, SUVs and commercial vehicles. In December 2025, Ford and Renault Group unveiled a major strategic partnership to broaden Ford’s electric vehicle lineup in Europe.
Tesla’s Price Performance, Valuation and Estimates
Tesla has underperformed the Zacks Automotive – Domestic industry year to date. Tesla has lost 7.5% compared with the industry decline of 5.1%.
Image Source: Zacks Investment Research
From a valuation perspective, Tesla appears overvalued. Going by its price/sales ratio, the company is trading at a forward sales multiple of 14.79, higher than the industry’s 3.64.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2026 and 2027 EPS has moved down 3 cents and 5 cents, respectively, in the past 30 days.
Image Source: Zacks Investment Research
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Is Tesla's Model Y Driving a Lasting Recovery in Europe?
Key Takeaways
Tesla’s (TSLA - Free Report) recovery in Europe gained momentum in May, as the electric vehicle maker recorded strong year-over-year sales growth across several major markets and achieved a record-breaking May performance in France.
Per the data published by various European automotive associations, Tesla registrations rose substantially in France, Denmark, Spain, Sweden and Norway compared with the same period a year earlier. The figures indicate that Tesla’s turnaround in Europe, which started earlier this year, is continuing to build after a challenging 2025.
France posted the strongest growth. Tesla registrations in the country reached 5,446 vehicles in May, up 655% year over year. The result represented Tesla’s highest-ever May sales in the country and ranked among its best monthly performances in France overall.
In other markets, Tesla registrations jumped 136% year over year to 1,750 vehicles in Denmark and surged 113% to 1,690 units in Spain. Sweden recorded a 71% increase to 858 registrations, while Norway, one of Tesla’s largest global markets, saw registrations rise 29% year over year to 3,345 vehicles.
Although the growth partly reflects easier comparisons against weaker results in 2025, Tesla is also benefiting from stronger demand for the updated Model Y. Last year, production of the vehicle was temporarily affected as factories shifted to manufacturing the refreshed version. The Model Y remains Tesla’s best-selling vehicle in Europe. In Sweden, it accounted for more than 670 of the company’s 858 registrations, while the Model 3 contributed roughly 185 units. Deliveries of the Model S and Model X remained relatively limited.
Tesla is also benefiting from favorable trends in the broader European EV market. Data from the European Automobile Manufacturers’ Association showed that registrations of electrified vehicles, including battery-electric, plug-in hybrid and hybrid models, rose about 21% in April and made up more than two-thirds of all new vehicle registrations across Europe.
Rising EV adoption, supportive government incentives and elevated fuel prices continue to drive consumers toward electric vehicles and away from conventional internal combustion engine cars across many European markets. TSLA carries a Zacks Rank #4 (Sell) at present.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Key Expansion Strategies of Tesla’s Peers in Europe
General Motors Company (GM - Free Report) exited its large traditional European business after selling Opel and Vauxhall in 2017. Its current strategy focuses on re-entering Europe's EV market through premium brands like General Motors and Cadillac, targeting higher-margin customers with models such as the Lyriq while expanding Cadillac’s sales and service network.
Ford Motor Company (F - Free Report) considers its commercial vehicle unit, Ford Pro, as its primary growth driver in Europe. Alongside its leadership in the van market, the company is expanding software, fleet management and connected services, while planning to launch seven new models by 2029, including EVs, hybrids, crossovers, SUVs and commercial vehicles. In December 2025, Ford and Renault Group unveiled a major strategic partnership to broaden Ford’s electric vehicle lineup in Europe.
Tesla’s Price Performance, Valuation and Estimates
Tesla has underperformed the Zacks Automotive – Domestic industry year to date. Tesla has lost 7.5% compared with the industry decline of 5.1%.
Image Source: Zacks Investment Research
From a valuation perspective, Tesla appears overvalued. Going by its price/sales ratio, the company is trading at a forward sales multiple of 14.79, higher than the industry’s 3.64.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2026 and 2027 EPS has moved down 3 cents and 5 cents, respectively, in the past 30 days.
Image Source: Zacks Investment Research