Tesla will be a no-show at next month’s IAA Mobility trade fair in Munich, a striking absence from one of Europe’s most high-profile automotive events.
The German Association of the Automotive Industry (VDA), which organizes the biennial show, confirmed the U.S. electric vehicle maker’s decision but did not explain. Tesla hasn’t commented officially yet on the withdrawal.
An explanation might be that the company fears political backlash and activists stealing the show. Musk’s public endorsement of the far-right Alternative for Germany party (AfD) ahead of this year’s federal election drew heavy criticism and fueled protests, some targeting Tesla vehicles directly.
Only ninth place
Once the country’s EV sales leader, Tesla’s market position in Germany has eroded sharply. It ranked only ninth in new electric vehicle registrations in the first seven months of 2025. The recurring political controversies surrounding CEO Elon Musk are believed to be the main reason for the decline.
Two years ago, at the last IAA, Tesla unveiled the refreshed Model 3 in what was a relatively understated display compared with competitors.
With Tesla’s pull-out, the spotlight in Munich will shift even powerfully toward a record number of Chinese exhibitors, a further illustration of how the dynamics of the global EV market are shifting.
“Secret weapon”
At the same time, Tesla is facing another strategic pivot, as Musk has announced the dismantling of its much-touted Dojo supercomputer project. Long, billed as the company’s “secret weapon” in the race to deliver fully autonomous driving, has been grounded.
Musk confirmed the news last week, with team leader Peter Bannon departing alongside roughly twenty engineers who are joining AI startup Density AI.
The decision follows years of delays, high costs, and a brain drain in Tesla’s AI engineering ranks, including the earlier departures of important senior chip architects.
External partners
The Dojo supercomputer was designed around custom-built D1 chips to process massive volumes of video data from Tesla vehicles, training neural networks for Autopilot, Full Self-Driving, and the Optimus humanoid robot.
Analysts saw Dojo as a potential game-changer. In 2023, Morgan Stanley valued the project’s possible contribution to Tesla’s market capitalization at $500 billion (€423 million), likening it to Amazon’s lucrative cloud computing division.
Musk, however, now argues that Tesla’s next-generation AI chips — known as AI5 and AI6 — will be “excellent for inference and at least pretty good for training,” making a separate in-house supercomputer effort redundant.
The strategic shift will see Tesla deepen its reliance on technology partners such as Nvidia, AMD, and Samsung. A deal with Samsung will secure the AI6 chip production in Texas until 2033, while the AI5 chips will be sourced from TSMC in Taiwan and later Arizona.
The end of Dojo marks a rare retreat from Musk’s much-trumpeted strategy of vertical integration – and leaves Tesla more dependent on the same supply chain as its rivals, just as competition in the EV market is intensifying.
