Norway's Tesla obsession defies Europe's Musk backlash
The U.S. electric vehicle maker recorded a 54% year-on-year jump in new car sales in Norway in June, according to data from the Norwegian Road Federation (OFV), fueled by a 115.3% yearly increase in registrations for its revamped Model Y sports utility vehicle.
The data backed up a whopping 213% increase in new car sales in May and shored up Tesla's dominant position in the world's most EV-friendly country.
Christina Bu, secretary general of the Norwegian EV Association (NEVA), which represents electric car owners in the country, said Tesla has been well established in Norway for several years — but the popularity of its upgraded Model Y is "definitely part of the reason" for its recent sales boost.
"In general terms, I think it just has to do with the fact that they deliver a car which has quite a lot of value for money and is what Norwegians need," Bu told CNBC during an interview at NEVA's office in Oslo.
The Tesla Model Y appears to be especially popular in Norway because of its competitive price and the fact that it meets local demand for large luggage space, high-ground clearance, all-wheel drive and a tow hitch, Bu said.
Sales data from southern Europe signaled some further green shoots for Musk's company, with Tesla new car registrations last month increasing by 61% in Spain and around 7% in Portugal.
The story remains very different across the rest of Europe, however. Tesla sales in Germany, Europe's largest automotive hub, dropped by 60% in June from a year earlier, while sales also dipped in France.
Separate data from the European Automobile Manufacturers Association, or ACEA, found Tesla's new car sales in Europe fell for a fifth straight month in May.
Tesla's brand value has been declining since 2024 in part because of Musk's political activity.
The Tesla CEO, who spent nearly $300 million to support Donald Trump's election campaign, recently left the White House after leading an initiative to slash federal agencies. Protests erupted at Tesla dealerships across Europe in response to Musk's role in the Trump administration.
Musk's departure from the White House in late May was followed by an extraordinary war of words with Trump. The world's richest man also formally endorsed Germany's far-right party AfD ahead of the country's parliamentary elections earlier this year, triggering an outcry in Berlin.
NEVA's Bu told CNBC that Musk's political activity hadn't gone unnoticed in Norway, with a recent annual survey of more than 15,000 EV drivers finding that 43% of respondents said they would not buy a Tesla for political reasons.
"So, this has definitely been a big debate in Norway as well. What Elon Musk has been saying and doing the last year or so — so it definitely affects people, but not too many because their market share is remarkable really," Bu said.
For its part, Norway has long been recognized as a global leader in sustainable transportation. Indeed, it is currently on track to become the first country in the world to effectively erase gasoline and diesel cars from its new car market.
Lawmakers and analysts have attributed the country's shift away from internal combustion engine (ICE) vehicles to long-term and consistent policies designed to support the uptake of EVs.
"I think it's a combination of several things, but it is policymaking that has driven this forward," Norway's Deputy Transport Minister Cecilie Knibe Kroglund told CNBC in Oslo.
"We have a lot of incentives, both tax incentives and user incentives are the most important things and also infrastructure, of course. But policymaking and incentives are the main tools that we have been using," she added.
Some of Norway's EV incentives include a VAT exemption, discounts on road and parking taxes and access to bus lanes. The government has also heavily invested in public charging infrastructure, and many Norwegian households are able to charge their cars at home.
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