And now we mention it, you might be realizing that you've never seen a Tesla ad at all. For a company run by Elon Musk, an individual known to not exactly be lacking in funding, it seems odd to not catch glimpses of sleek models Y’s and S’s glittering in Times Square, let alone dominating your neighbor’s flat screen on a Sunday evening.
Tesla doesn't advertise
As it turns out, this is a signature Tesla move: Musk himself does not like advertising and refuses to spend a dime on it. He has been notably blunt on his distaste for it, preferring instead, he says, to invest that money in the product itself. It doesn't hurt that Musk’s (free) tweets are as words carved in stone by a deity to his 75.7 million followers.
Although Tesla did once feature a round-up of amateur ads designed by fans, no money was spent, and the pieces weren't published on any kind of platform that required a fee.
As noble as sticking to one’s principles is, does Tesla need to
reconsider its stanceon paying to put itself out there, especially with the heightened competition in the EV market, laid out in the numerous, often celebrity-sponsored, Super Bowl advertisements?
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Tesla’s advertising competition
And that competition isn't shy about looking to replace Tesla as the leading name in the industry. A new-to-the-EV-scene automaker, Polestar, a brand-child of the Chinese company Geely that also owns Volvo, implied in its TV spot that they cared exclusively about the quality and sustainability of their electric vehicles, rather than “conquering mars.”
Seems like Polestar has a finger on the pulse of the complaints that Tesla has been facing lately. After all, if it can position itself as a more reliable, but equally fun, electric car, then it might have an edge.
Is Musk on cruise control?
In late February, Tesla stock dropped 11%, and overall revenues plummeted 31%. Some of this dip can be attributed to being weaned off the $7,500 tax credit that was awarded for the first 200,000 electric cars sold by Tesla. (Other EVs are also eligible for the credit, but Tesla is the first to reach it.) The company is still filling a six-month waiting list; they're not exactly in dire straits.
Yet, as Polestar hinted, investors and Tesla fans, in general, are disappointed by Musk’s decision to focus on a variety of projects in 2022 and shelve the development of new models, including the rumored $25,000 car.
Tesla is taking something of a gap year in 2022. Musk has designated the calendar year to focus on artificial intelligence factory workers, the smart self-driving car, and, of course, SpaceX.
It's the mark of a well-run business to pay attention to the details and take time to deliver a safe and aesthetically-pleasing product, but some question whether Musk is prioritizing the wrong things at the wrong time.
The new EVs in the market
The entire nation just witnessed three hours of competitors advertising newer, shinier,
cheaper, and greener EVs (there might have been some football somewhere in there too).
But there's a catch—many of the EVs advertised won't be eligible for purchase until 2024, with the BMW iX being the earliest release in the US later this year. Perhaps Musk is counting on coasting along on the Tesla name alone until push comes to shove. Perhaps he believes that Tesla will be the go-to brand because of his stance on product-over-marketing.
It remains to be seen, but at $9 billion a year coming out of competitors’ pockets for advertising alone, he'd best be on high alert.
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