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Tesla’s Sales Rise in Parts of Europe but Pressure Mounts From Rivals

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Tesla recorded a modest rebound in several European markets in September, buoyed by sales of its updated Model Y, but analysts warn the U.S. automaker faces mounting challenges from both European and Chinese competitors amid an ageing product lineup.

According to local industry data released Wednesday, Tesla’s sales rose in France, Denmark, Norway, and Spain, with the Model Y emerging as Denmark’s best-selling vehicle. However, new car registrations fell in Sweden and the Netherlands—the latter marking its ninth consecutive monthly decline.

Despite recent gains, Tesla’s broader European performance remains weak. Between January and August, Tesla’s sales fell 42.9% year-on-year in the European Union and 32.6% across Europe overall, even as the region’s total EV sales jumped 24.8%.

Matthias Schmidt of Schmidt Automotive Research described the September uptick as “a bottoming out of the downward trend rather than any real signs of an expected uplift.” He said an affordable Model Y variant, expected in 2026, could help, but Tesla’s prospects remain “tough in a more competitive market environment.”

Once dominant in Europe, Tesla now faces an influx of new EVs from Volkswagen, BMW, Renault, and Chinese players like BYD, which outsold Tesla in the EU in August for the second time this year.

The automaker’s reputation has also been affected by political backlash against CEO Elon Musk, whose support for Donald Trump’s re-election campaign and European far-right parties has alienated some consumers.

Andy Palmer, chairman of Electric Vehicles UK, said Tesla is still “a big fish, but the pond is now full of serious competitors.” Unless it refreshes its range soon, he warned, “it will keep losing market share.”

Performance varied sharply across Europe in September:

  • France: +2.74% year-on-year

  • Denmark: +20.5%, with the Model Y leading sales

  • Norway: +14.7%, with Model Y and Model 3 ranking top two

  • Spain: +3.4%, boosted by a 60% surge in Model Y registrations

  • Sweden: –64% year-on-year, though higher than August levels

  • Netherlands: –48%

Analyst Andy Leyland of SC Insights said Tesla’s biggest challenge lies ahead: “Chinese automakers are rapidly building distribution networks in Germany, the UK, and France. It will be critical to see whether Tesla can still compete.”

Qualcomm Shares Fall on Downbeat Forecast for Licensing Business

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Qualcomm’s (QCOM.O) shares dropped by around 5% in early trading on Thursday following a disappointing forecast for its patent licensing business, despite strong expectations for quarterly sales and profits. The chipmaker revealed that its licensing business, which contributed 14.8% to its total revenue in the reported quarter, would experience no sales growth this year due to the expiration of its agreement with Huawei Technologies (HWT.UL).

TD Cowen analysts had initially expected the removal of Huawei’s royalty payments to have a mild impact, but they noted that the development adds to the “wall of worry” surrounding Qualcomm’s stock. However, analysts pointed out that Qualcomm has secured licensing agreements with two other Chinese smartphone manufacturers, which may help mitigate some of the losses.

The company’s first-quarter performance exceeded expectations, driven by strong demand for AI features in mobile devices, and is often seen as a barometer for broader smartphone industry trends. Qualcomm’s second-quarter sales forecast of $10.75 billion, with adjusted profits of $2.80 per share, surpassed analysts’ estimates of $10.34 billion and $2.69 per share, respectively, as reported by LSEG data.

While Qualcomm credited growth in its smartphone division to strong sales from China, powered by government subsidies and flagship smartphone launches, it also highlighted positive performance across other business segments, including handsets, autos, and IoT.

Despite gains in 2024, Qualcomm’s stock has underperformed AI chip leader Nvidia (NVDA.O), whose shares surged by 171%. Qualcomm’s stock has increased by 6% this year, far surpassing the losses seen by competitors like Intel (INTC.O), which saw a 60% decline, and Advanced Micro Devices (AMD.O), which dropped by 18%.

As a result of the company’s outlook, Qualcomm’s median price target decreased slightly to $192, down from $199 prior to the report, according to LSEG data. The company’s forward price-to-earnings ratio stands at 15.02, significantly lower than Nvidia’s 27.64 and Intel’s 32.21.