(Reuters) -Sales of new Tesla (TSLA) cars in Sweden, Denmark and France fell in July for the seventh straight month, as the EV maker struggles with a backlash to CEO Elon Musk's political views, regulatory challenges and competition from European and Chinese brands.

Tesla's aging lineup is facing a wave of low-cost EV rivals, especially from China. It is rolling out a revamped Model Y and starting to produce a new, cheaper model, but production of that will only ramp up next quarter, later than initially expected.

The brand's sales were down 86% year-on-year in July to 163 cars in Sweden, 52% to 336 cars in Denmark and 27% to 1,307 cars in France, official industry data showed, after dropping by over a third in Europe in the first six months of the year.

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With no more affordable-end vehicles on the horizon until the last three months of the year and the upcoming end of a $7,500 U.S. tax break for EV buyers, Musk acknowledged in July that Tesla could have "a few rough quarters".

He said tough automated driving regulations in Europe made it harder to sell the Model Y in some countries, as the vehicle's optional supervised self-driving is "a huge selling point".

"Our sales in Europe, we think will improve significantly once we are able to give customers the same experience that they have in the U.S.," he told analysts.

Model Y registrations in Sweden and Denmark fell by 88% and 49% respectively in July.

Tesla launched in June a trial robotaxi service in Austin, Texas, using about a dozen Model Y SUVs controlled by its autonomous-driving software. But the roll-out of its self-driving features elsewhere in the U.S. is bogged down because it hasn't received the required permits.

Overall car sales slid 8% in France and were up 20% in Denmark and 6% in Sweden in July, the industry data showed.

Other European countries, including Italy, Norway and Spain, are expected to release July car sales data later on Friday.

European automakers Volkswagen, Mercedes-Benz, Stellantis, Renault and BMW have published downbeat second-quarter results, warning of pressure from U.S. import tariffs and falling demand.

(Reporting by Alessandro Parodi, Camille Raynaud, and Louise Rasmussen. Editing by Himani Sarkar and Mark Potter) Sign up for the Yahoo Finance Morning Brief

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