Is Tesla's Grip on the EV Marketing Slipping?
Tesla is king of EVs—for now. But can it maintain that grip on American electric car buyers?
Written by Andrew Kidd
Reviewed by Kathleen Flear
Tesla
still dominates the electric vehicle market in the U.S. But will that last with the competition closing in?Tesla is still the preeminent electric automaker in the U.S. market, but its competition is growing—and rapidly. Electric vehicle sales in the U.S. have nearly doubled in the first quarter of 2022 over the previous year. Will Tesla hold on to its market share?
75% of EVs sold are Tesla models
As first quarter sales for 2022 indicate Tesla is dominating the
electric vehicle
segment, with nearly 75% of electric vehicles sold between January and March being Tesla models. The Model Y and Model 3 make up about 68% of those sales.Tesla also maintains a giant lead over its closest competitor in terms of sales; Americans purchased more than 46,000 Tesla Model 3s, with Mustang Mach-E sales numbering just 6,734 in the first quarter.
The automaker’s biggest advantage is its head-start in bringing electric vehicles to market. But can Tesla maintain that sales dominance when its competitors are catching up and crowding the field?
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Tesla competitors are coming
As
Kelley Blue Book
(KBB) reports, Americans purchased just 18 different models of electric vehicles in the first quarter of 2021. That number has doubled to 32 in the first quarter of 2022 and is only expected to grow from there. KBB predicts there will be at least 50 different electric vehicle models—sedans, crossovers, SUVs and trucks—available by the end of the year.
Tesla is also
raising the prices
of its vehicles, despite record profits in 2022. On top of that, it no longer includes a mobile charger
with its new vehicles—both moves that could further deter some potential electric vehicle customers and send them straight to its more affordable competition.An upcoming rival, KBB notes, is the Hyundai Ioniq 5, which took home the publication’s “World Car of the Year” and “World Electric Vehicle of the Year” for 2022. The Ioniq 5 starts at $44,000, which KBB notes is comparable to Tesla Model Y’s original starting price. The Model Y, however, now starts at $64,990. It also charges faster than Tesla’s electrical architecture.
To make them even more affordable than their competition, Hyundai vehicles can receive a $7,500 tax rebate—which Tesla’s vehicles are no longer eligible for.
MORE: The CEO of Rivian Has a Bleak Warning Sign for the EV Industry
Not just electric cars and SUVs
Tesla is definitely going to have some fierce competition in a truck market dominated by Ford, GM and Ram for the past several decades.
Tesla is introducing its unconventional-looking Cybertruck in 2023, which has already seen a handful of delays.
But other automakers have beaten Tesla to the punch. Ford just launched its all-electric F-150 Lightning, which boasts more utilitarian features like two-way charging and what seems to be a more practical albeit traditional truck bed.
Chevy’s all-electric Silverado pickup will launch late in 2023 with an MSRP starting at $39,900; the automaker has started taking reservations as well—meaning Tesla will be wading into a market populated by automakers with literal centuries of combined experience producing trucks.
Tesla will have its work cut out for itself if it hopes to keep its grip on the EV market in the future, especially if it banks on pickup trucks in an already crowded environment. It will have to seriously innovate to give its consumers what it wants, or possibly rebrand itself as a luxury marque if its prices keep skyrocketing.
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