Tesla Records Recovery in Europe, Is TSLA Stock Attractive Again for Investors?

Tesla recorded a significant recovery in Europe with registrations surging 152% in May 2026, marking four consecutive months of growth and pushing its market share from 0.9% to 2.3%.

Despite the good news, TSLA shares remain under pressure, down 13% year-to-date, due to the crash investigation in the US, fierce competition from BYD, whose registrations rose 158.8% in Europe, and a $25 billion capital expenditure plan that is weighing on cash flow.

Elon Musk increased his stake to 19.9% ​​through a $110 billion option exercise in a sign of confidence, but analysts still rate the company a Hold with an average price target of $409.

This article will analyze whether the recovery in Europe is enough to make Tesla shares attractive to investors again.

Key Takeaways

• Tesla registrations in Europe rose 152.4% in May 2026, with market share rising from 0.9% to 2.3%. However, BYD still leads with 26,017 units (+158.8%).

• TSLA shares are down 13% this year, weighed down by the US crash investigation, BYD competition and $25 billion in capex weighing on cash flow.

• Elon Musk boosted his stake by 19.9% ​​through a $110 billion option exercise, a signal of confidence but also concentration of ownership.

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Tesla Records Recovery in Europe

Tesla recorded a significant recovery in the European market in May 2026. According to data from the European Automobile Manufacturers' Association (ACEA), Tesla registered 21,767 new cars in the European Union, up 152.4% from 8,623 units in May 2025. Tesla's market share rose from 0.9% to 2.3%.

Year-to-date (January-May 2026), Tesla registrations in the EU reached 89,180 units, up 77.3% from 50,309 units in the same period last year.

This marks a consistent recovery for four consecutive months.

However, competition remains fierce. BYD (Tesla's main competitor) recorded 26,017 registrations in May 2026, a 158.8% year-over-year increase.

In the global competition, BYD briefly surpassed Tesla as the world's largest EV seller in 2025 (2.26 million vs. 1.64 million units), although Tesla reclaimed the top spot in Q1 2026.

Read also: Behind SpaceX's IPO, Tesla Is Quietly Preparing for Massive Growth

Tesla's Performance in China and Q2 Deliveries

Tesla also recorded growth in China, its largest market outside the US.

Tesla's domestic retail sales in China reached 47,281 units in May 2026, up 22.5% year-over-year and jumping 82% month-over-month from a weak April.

This ended two consecutive months of decline.

Goldman Sachs raised its estimate for Tesla's Q2 deliveries to 420,000 units from 405,000, citing stronger sales data in China, the US, and Europe. UBS also raised its forecast to 405,000 units, noting that the market was looking for a figure between 400,000 and 420,000.

TSLA Stock Price and Market Sentiment

Read also: Price Tesla tokenized stock (TSLAX)

TSLA stock price on June 22, 2026 was at $393.53, down 13% year-to-date.

On June 23, the stock opened at $392.15 and traded at $384.63 after news of the crash investigation.

Valuation:The P/E ratio is around 353x — very high for an automotive company.

Analyst price target:average of $409.18 (consensus Hold from 27 analysts). Baird maintained an Outperform rating with a target of $522. UBS gave a Neutral rating with a target of $364.

Retail sentiment:On Stocktwits, sentiment was “extremely bearish” in the last 24 hours, despite chat volume rising 493% in 30 days.

Read also: What Crypto Does Elon Musk Own? A Peek at the Tesla CEO's Portfolio

Factors Pressuring TSLA Stock

There are several factors that are putting pressure on Tesla shares:

1. US accident investigation

The National Highway Traffic Safety Administration (NHTSA) has opened an investigation into a Model 3 crash in Texas that killed a 76-year-old woman. Tesla said the driver "manually overrode self-driving" by fully depressing the accelerator pedal.

Elon Musk called the report "absurd." The case could affect confidence in FSD.

2. Tight competition

BYD and Leapmotor (up 465.1% in Europe) continue to erode Tesla's market share.

3. Large capex

Tesla raised its 2026 capital expenditure projection to $25 billion from $20 billion, weighing on short-term cash flow.

4. Uncertainty about FSD regulations in Europe

Sweden issued a safety warning, while Belgium gave the green light. Uneven regulations create uncertainty.

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Positive Signal: Elon Musk Boosts Stocks

On June 19, 2026, Elon Musk exercised $110 billion worth of stock options, increasing his ownership of Tesla to 19.9%. This is typically a signal of confidence from a highly influential insider.

However, the market reacted in a mixed way: on the one hand, it showed Musk's confidence, on the other hand, the concentration of ownership raised questions about corporate governance.

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Conclusion

Tesla recorded a recovery in Europe with registrations rising 152% in May 2026. However, TSLA shares remained under pressure from accident investigations, BYD competition, and $25 billion in capex.

Elon Musk increased his stake to 19.9%, a signal of confidence but also concentration of ownership.

The average analyst price target is $409, with a Hold rating. The European EV market is growing, but competition is intensifying. For investors, the outlook for TSLA stock depends on Q2 deliveries (July 2026) and FSD regulatory developments.

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FAQ

Is Tesla recovering in Europe?

Yes. Tesla registrations in the EU rose 152.4% in May 2026, with market share rising from 0.9% to 2.3%.

Who are Tesla's main competitors?

BYD is a major competitor. In Europe, BYD registrations rose 158.8% to 26,017 units.

What is the TSLA stock price today?

$393.53 (June 22, 2026), after opening at $398.10.

Why are TSLA shares down 13% year-to-date?

US crash investigation, BYD competition, and $25 billion in capex weighing on cash flow.

What are analysts' price targets for TSLA?

Average $409.18 (consensus Hold). Baird target $522, UBS target $364.

Is Elon Musk increasing Tesla stock?

Yes. On June 19, 2026, Musk exercised a $110 billion option, increasing his stake to 19.9%.

What is Tesla FSD?

Tesla's Full Self-Driving system. In Europe, Sweden issues warning, Belgium approves.

How much are Tesla's Q2 deliveries?

Goldman Sachs estimates 420,000 units, and UBS estimates 405,000 units. Data will be released in early July 2026.