Data released on Tuesday showed that Tesla's (NASDAQ:TSLA) sales in Europe contracted in November, while Chinese rival BYD (HK:1211) posted strong year-on-year growth and a steadily increasing market share in the region.

Tesla sales in the European Union, the European Free Trade Association and the United Kingdom fell 11.8% year-on-year to 22,801 units in November, according to data from the European Automobile Manufacturers Association.

Tesla's market share also shrank to 2.1% from 2.5% a year ago, but it improved from the disappointing 0.6% seen the previous month.

In contrast, BYD's sales in November surged 221.8% year-on-year to 21,133 units, while the Chinese company's market share jumped to 2% from 0.6% a year earlier. BYD's market share also improved from the 1.6% recorded in October.

This came as total new vehicle registrations in Europe rose 2.4% year-on-year to 1.08 million units, according to ACEA data. This increase was primarily driven by improved sales of battery electric and hybrid vehicles, with the latter capturing the largest share of the European market at 34.6%.

While Tesla's sales in the region fell at a relatively slower pace in November compared to previous months, they still reflect a continuing decline for the electric carmaker as it grapples with increasing competition from local and Chinese players.

Tesla was also still struggling to restore its brand image after CEO Elon Musk's political actions alienated a large part of the electric carmaker's customer base earlier this year.

BYD has become a major competitor to Tesla in Europe and China, with the automaker bolstering its European offerings this year. BYD has also been well-received despite having to contend with high European import duties.

The Chinese automaker has put expansion into Europe and other regions high on its agenda, especially with sales slowing in its main Chinese market.

BYD also has an advantage over Tesla in that it sells the highly popular hybrid car segment. Hybrid cars have become increasingly popular among cost-conscious consumers who are unwilling to pay the high price of a battery-electric vehicle.