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Published on
June 4, 2025
5 min read
Tesla Sales in Australia Soar Despite Drop in European and US Markets
Tesla has recorded the highest vehicle sales in the Australian market after almost a year, CNBC reported. On June 3, the company said sales of its vehicles in the country increased by 3,897 units in the month of May. The rebound of Tesla sales performance in Australia comes at a time when the EV manufacturer is experiencing sales declines in Europe and the US.
Encouraging Sign
Data from the Australian Electric Vehicle Council showed that Tesla deliveries increased by 9.3% year-on-year. The EV maker experienced the lowest sales in April when only 500 units were sold. In May, the sales rebounded, rising by more than 675%. But even with this rebound, Tesla’s overall sales in Australia dipped by 48.2% compared to the same period in 2024.
“Tesla’s strong sales growth in Australia this May is an encouraging sign, driven almost entirely by strong demand for the updated Model Y. But globally, Tesla is still facing headwinds,” Counterpoint Research Associate Director Liz Lee said.
Tesla’s vehicle sales jump was driven by high sales of its revamped compact sport Model Y utility car. Sales of this vehicle in Australia rose 122.5% year-on-year. Model 3 sales dipped significantly in the same period. Lee also said that Tesla sales in quarter one dropped by 13% year-on-year.
She added that, “while the latest Australian rebound is meaningful locally, it does not yet signal a broader global recovery.”
Rising Competition
Tesla continues to face fierce competition from Chinese EV manufacturers in many parts of the world. One of its biggest competitors is BYD, which has expanded globally amidst growing competition in China. In April, BYD outsold Tesla in the European market for the first time. The Chinese EV maker unveiled a range of discounts in China, a move that caused rival EV vehicle makers in the country to do the same.
As the Tesla vs BYD market share competition continues, reports indicate that BYD registered higher annual sales revenue than Tesla in March this year. In May, recovery of Tesla sales in Australia enabled the US EV maker to regain its lead over BYD when it sold 3,897 units compared to BYD’s 3,225 units. Tesla only sells battery EVs that run on electricity. BYD also produces and sells hybrid vehicles that combine electric batteries with internal combustion engines.
Data from the FCAI shows that sales of hybrid cars and plug-in hybrid EVs rose by 6% and 118% respectively in the month of May.
“Recent sales data indicate that consumers are increasingly turning to hybrid and plug-in hybrids as many Australians want to reduce their vehicle emissions,” FCAI CEO Tony Weber said.
The Musk Effect
In recent months, Tesla sales have been dropping due to rising competition. Brand damage associated with Elon Musk’s political activities have also been blamed for the drop in Tesla sales. In May, Tesla sales in Australia suffered following vandalism and protests triggered by Musk’s position in President Donald Trump’s administration and Musk’s support for far-right parties in Europe.
On June 3, Tesla reported a slow down in US sales following an 11% drop from May 20224. Sales of new Tesla EVs were also reported in European countries like Portugal, Spain, Sweden, and Denmark last month. But all is not lost for the US EV manufacturer. In Norway, the company reported a surprise bounce back after its May sales of its Model Y EVs rose 213% compared to the same period last year. Tesla also reported record breaking sales in Turkey where it sold 1,545 units.
Last week, Musk officially exited his role at the Department of Government Efficiency (DOGE). When announcing Musk’s exit from the federal government, President Trump said Musk will continue to serve as an advisor. But considering the brand damage on Tesla, analysts believe that Musk’s time in the political scene is over.
Dan Ives of Wedbush said Musk’s return to the EV maker is the “best possible news Tesla investors could have heard,” as the company prepares to launch its robotaxi later this month. The EV maker has been testing driverless Model Ys in Austin, Texas.
