Tesla is facing backlash due to intense competition in China, while European consumers have lost faith in Elon Musk.

The U.S. EV maker sold 93,926 China-made vehicles globally in January and February, according to the China Passenger Car Association (CPCA).

Deliveries of the China-made Model 3 and Model Y vehicles dropped 49.2% in February compared to the same period last year, reaching 30,688 units—the lowest since August 2022—following an 11.5% decline in January.

The January-February sales were affected by the Chinese New Year holiday shifting from February last year to late January this year and a partial suspension of Model Y production for upgrade work. The automaker also exports these vehicles to markets including Europe, where sales plunged 45% in January.

Tesla recently updated its FSD software in China to enable city navigation in late February. The company also began deliveries of the revamped Model Y in its second-largest market. However, with intense competition and youth more favorable to Xiaomi and other domestic automakers, the outdated model is no longer attractive anymore.

In Europe, Tesla's sales continued to decline in February. The company sold 2,395 vehicles in France, marking another 26% year-over-year decline. Sales in Norway, Sweden, and Denmark fell by over 40% in February alone.

The decline in European sales is partly attributed to the negative perception of tesla due to Elon Musk's involvement in global politics. The U.S. government, led by Trump and Musk, has faced backlash, with Musk's public comments on global affairs, such as the recent German election, generating widespread dislike. Additionally, Trump's tariff threats have fueled anti-Tesla sentiment in China, with Trump planning to impose a further 10% tariff starting Tuesday.