Tesla shares drop 3% on robo-taxi doubts, mixed Europe sales

Tesla shares fell about 3.1% on Tuesday, giving back part of Monday’s 5.5% rally. The S&P 500 and Dow Jones Industrial Average each slipped about 0.5% during the session.

The pullback followed a reassessment of Tesla’s robo-taxi prospects and mixed vehicle registration figures from Europe. Tesla launched its robo-taxi service in Austin, Texas, in June 2025 and has since expanded operations to Miami and Dallas.

Growth of the service has been limited. Gary Black, co-founder of Future Fund, estimated Tesla’s robo-taxi fleet at roughly 100 vehicles, compared with an estimated nearly 4,000 vehicles operated by Waymo across more than a dozen U.S. cities. Tesla’s share price remains only a few dollars above its late-June 2025 level, shortly after the robo-taxi launch.

Competition in autonomous ride-hailing has increased. Amazon’s Zoox offers robo-taxi rides in some locations and Waymo has expanded its footprint and marketing. Morgan Stanley values Tesla’s autonomous driving technologies at roughly $1 trillion, about six times the value it assigns to the company’s traditional car business.

August vehicle registration data in several European markets showed gains in France and Denmark and declines elsewhere. Registrations rose 279% year-over-year in France and 104% in Denmark, while they fell 79% in Norway and Spain, 41% in Sweden, 37% in Portugal and 36% in Italy. Registration totals are used as a proxy for sales.

Rico Luman, senior economist at ING Research, attributed the increases in France and Denmark to rising electric-vehicle adoption and lower Tesla pricing. Matthias Schmidt, a European auto market analyst, linked the drop in Norway in part to a strong prior-year comparison when buyers accelerated purchases ahead of a fiscal policy change.

Tesla’s European sales have rebounded this year after two consecutive annual declines, supported by easier comparisons, higher fuel prices, government incentives and stronger consumer interest in electric vehicles. Registration figures from the U.K. and Germany, Europe’s two largest car markets, are due later this week.

Market participants will monitor whether Tesla can expand its robo-taxi fleet and convert autonomous driving technology into a sustained revenue source.