The Tesla Model 3 was Europe’s best-selling midsize premium car in March, beating better-established models from BMW, Audi and Mercedes-Benz.
Tesla sold 15,755 Model 3s in March, putting it ahead of the Mercedes C class, BMW 3 series, and Audi A4, figures from JATO Dynamics show.
The new electric midsize sedan was the best-selling car in Norway, Switzerland and the Netherlands in March. In Norway, it had 29 percent market share,
The impressive debut of the sedan, which starts at 44,500 euros in Germany, made Tesla the No. 25 brand by unit sales in Europe in March, putting it ahead of premium rivals such as Lexus, Jaguar and Alfa Romeo.
Tesla has not started selling the Model 3 in all European markets, suggesting sales could climb. The electric vehicle maker announced this week that Model 3 deliveries would start next month in the UK, which is a key market for EV sales.
The success of the Model 3, however, was countered by a dramatic fall in demand for Tesla’s older models. European sales of the Model S large sedan declined 72 percent to 787, causing it to lose its lead in the large premium segment to the Mercedes S class.
Sales of the Model X SUV fell 52 percent to 874.
Pent-up demand for the Model 3 helped boost sales of electric cars across Europe to 40,000 in March, up 85 percent on the same month the year before, according to JATO.
After Tesla’s electric vehicle sales erupted in Norway, the Netherlands and Switzerland in March, April was a let down, according to data by the countries’ motor authorities.
In Norway, where electric cars top sales lists consistently, the Model 3 was unseated as the top-selling car by the Volkswagen Golf, of which there is an electric variant.
Tesla’s European deliveries before February were much lower -- frequently below 200 units in Germany and Norway -- as the company’s higher-priced Model S and Model X cars were the only vehicles available. That changed when the more mass-market Model 3 went on the market and fueled the delivery surge.
The European performance of the Model 3 will be crucial to a company that’s relying on the car to generate enough cash to become self-sustaining. Tesla on Friday announced it raised $2.35 billion through debt and stock offerings after overestimating how fast the car could generate that money.
The European launch caused “many challenges encountered for the first time,” Tesla said in a statement in early April. About 10,600 cars were still in transit at the end of the first quarter.
When asked by analysts at Tesla’s last quarterly earnings call whether the firm would disclose deliveries on a monthly basis, Musk called the idea "counterproductive.”
“Sales to a particular country, say, overseas, are affected by when the ship arrives. And so, if the ship arrives on the 31st of the month or the first of the next month, this will make it look like something dramatic has happened,” Musk said on the call. “But actually, the ship was just a day late.”
Tesla is working on an SUV version of the Model 3 called the Model Y, with production slated to start in 2021. Tesla CEO Elon Musk has predicted the Model Y would outsell all the automaker’s models combined. The SUV will start at 56,000 euros in Germany, the brand has said.
Tesla’s balance sheet in Europe will be boosted by a “multi-year” deal in which Fiat Chrysler Automobiles will pay the zero-emissions brand to help offset its own fleet CO2 output to comply with tougher tailpipe pollution standards that start to take effect in 2020.
-- Bloomberg contributed to this report