Europe's new car market experienced a slow start in January 2026. Total registrations across the European Union (EU), United Kingdom (UK), and European Free Trade Association (EFTA) decreased by 3.5% compared to January 2025, reaching 961,382 units. Despite this overall slowdown, BYD celebrated significant growth while Tesla faced a substantial decline.

Tesla's registrations fell by 17% to 8,075 vehicles, according to data from the European Automobile Manufacturers' Association (ACEA). This reduced the electric vehicle giant's market share to 0.8%, down from 1% a year prior. This marks Tesla's 13th consecutive month of declining sales in Europe, indicating a sustained downward trend.

BYD Sealion 7 and Tesla Model Y in Europe. Photo: Tuningblog

Conversely, BYD accelerated rapidly with its range of electric and hybrid vehicles. The Chinese brand sold 18,242 vehicles across the same region, achieving an impressive 165% growth year-on-year compared to January 2025 (175% in the EU alone). This boosted BYD's market share to 1.9%, more than double that of Tesla.

Tesla was not the only automaker to experience losses in January. The Renault Group also faced a challenging month, with sales dropping by 15% to 83,201 units. While the Renault brand itself saw a 4.4% increase, a significant 35% decline from its Dacia subsidiary impacted the group's overall performance. BMW and the Volkswagen brand also reported decreases of 8.7% and 11.2% respectively, while Mini and Skoda achieved growth of 11.2% and 10.1%.

Regarding powertrains, the electrification trend continued to accelerate. Battery electric vehicle sales increased by 13.9%, now accounting for 19.3% of the EU market in January, up from 14.9% in January 2025. Plug-in hybrid vehicles saw a 32.2% rise, while gasoline car registrations sharply decreased by 25.7%, and diesel vehicles fell by 22%.

The situation varied across individual countries. Germany and France both experienced a 6.6% decrease in total vehicle registrations, yet their electric vehicle registrations increased by 23.8% and 52.1% respectively. Norway, a nation historically at the forefront of electric vehicle adoption, faced a sharp 76.3% drop in total registrations, largely due to the discontinuation of government incentives. My Anh (according to Carscoops).