Tesla (TSLA.O) shares fell nearly 6 per cent in early trading in Europe on Thursday, after Elon Musk’s electric vehicle maker posted its worst quarterly decline in sales in over a decade.

Shares in the company were down 5.7 per cent in Frankfurt, having dropped 5 per cent in after-hours trading on Wall Street on Wednesday.

Tesla’s second-quarter profit missed analysts’ expectations, yet its profit margin on making cars was not as bad as many had feared.

On a conference call, chief executive Musk said US government cuts in support for electric vehicle makers could lead to a “few rough quarters” for the company before a wave of revenue from self-driving software and services begins late next year.