- 7,000 units sold in Turkey
- Lowest EV tax rate increasing
- Togg leads domestic market
Tesla’s Model Y was the bestselling car in Turkey in June, the company said in its second-quarter earnings late Wednesday, just hours before the government hiked taxes on electric vehicles, threatening to undercut one of its fastest-growing markets.
A presidential decree published in Turkey’s Official Gazette on Thursday raised the lowest tax rate on EVs from 10 percent to 25 percent.
The hike could add up to $6,000 to the price of a Model Y, which previously started at around 1.87 million lira ($46,100), according to market data.
“Model Y became the best-selling car in Turkey, Netherlands, Switzerland and Austria in June,” CEO Elon Musk said on the earnings call.
Tesla sold 7,235 units of its Turkey-specific Model Y in June, up 171 percent from 2,670 a year earlier, according to the Automotive Distributors and Mobility Association, outpacing local brands and Chinese rivals.
The new Turkish tax hike could blunt that momentum.
While the Turkish government also raised rates on hybrids and gasoline-powered vehicles, the sharpest increase applied to the EV band most relevant to Tesla.
The US EV maker still trails Turkey’s homegrown brand Togg on a year-to-date basis.
Togg led the domestic EV market in the first half of 2025 with 17,101 units sold, accounting for a fifth of total domestic EV sales, followed by Tesla with 12,320 and China’s BYD with 10,401.
Togg is also working to roll out its T10F sedan, with deliveries expected to start soon.
It remains unclear whether the new tax hike will affect Togg to the same extent.
While the decree applies to all fully electric vehicles that fall under the stated price and power thresholds, Togg has historically benefited from more favourable treatment as a domestically manufactured brand, including broader eligibility for the lowest tax band.
Overall, EV sales in Turkey jumped 138 percent year on year in the first six months of 2025 to 84,956 units.
Tesla reported a 12 percent drop in revenue for Q2 2025 to $22.5 billion and a 13.5 percent decline in global deliveries, dragged by weaker performance in Europe and the US.
“We’re in this weird transition period where we will lose a lot of incentives in the US… We probably could have a few rough quarters,” Musk warned investors on the call, referring to the upcoming period as US EV tax credits phase out.
Tesla shares fell about 5 percent in after‑hours trading on July 23.
