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CNBC

PUBLISHED TUE, NOV 29 20223:21 PM ESTUPDATED TUE, NOV 29 2022AT 4:48 EST
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Michael Wayland@MIKEWAYLAND
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Lora Kolodny@LORAKOLODNY
KEY POINTS
  • Tesla is still the top-selling electric vehicle brand in the U.S., but its dominance is eroding as more affordable models proliferate.
  • S&P Global Mobility reports Tesla’s market share of new registered electric vehicles in the U.S. stood at 65% through the third quarter, down from 71% last year.
  • The firm forecasts Tesla’s market share will decline to less than 20% by 2025.

A Tesla Model 3 vehicle is on display at the Tesla auto store on September 22, 2022 in Santa Monica, California. Tesla is recalling over 1 million vehicles in the U.S. because the windows can pinch a person’s fingers while being rolled up.

Tesla is still the top-selling electric vehicle brand in the U.S., but its dominance is eroding as rivals offer a growing number of more affordable models, according to a report Tuesday by S&P Global Mobility.

The data firm found that Tesla’s market share of new registered electric vehicles in the U.S. stood at 65% through the third quarter, down from 71% last year and 79% in 2020. S&P forecasts Tesla’s EV market share will decline to less than 20% by 2025, with the number of EV models expected to grow from 48 today to 159 by then.

A drop in Tesla’s U.S. market share was expected, but the rate of the decline could be concerning for investors in Elon Musk’s autos and energy company. As Musk focuses attention on fixing his recently acquired social media company, Twitter, Tesla shares closed down by about a point to $180 on Tuesday. Tesla’s stock has declined by almost half year to date.

S&P reported that Tesla is slowly losing its stranglehold on the U.S. EV market to fully electric models that are now available in price ranges below $50,000, where “Tesla does not yet truly compete.” Tesla’s entry-level Model 3 starts at about $48,200 with shipping fees, but the vehicles typically retail for higher prices with options.

“Tesla’s position is changing as new, more affordable options arrive, offering equal or better technology and production build,” S&P said in the report. “Given that consumer choice and consumer interest in EVs are growing, Tesla’s ability to retain a dominant market share will be challenged going forward.”

The new data follows a Reuters report Monday that Tesla is developing a revamped version of its entry-level Model 3 aimed at cutting production costs and reducing the components and complexity in the interior.

During the company’s third-quarter earnings call in October, Musk said Tesla was finally working on a new, more affordable model that he first teased in 2020.

“We don’t want to talk exact dates, but this is the primary focus of our new vehicle development team, obviously,” he said, adding that Tesla had completed “the engineering for Cybertruck and for Semi.”
He described the future vehicle as something “smaller,” that will “exceed the production of all our other vehicles combined.”

Stephanie Brinley, associate director of AutoIntelligence for S&P Global Mobility, noted that Tesla’s unit sales are expected to increase in coming years despite the decline in its market share.

Tesla’s current leadership in EVs is over a relatively insignificant market. Despite the amount of attention surrounding EVs, sales of all-electric and plug-in hybrid electric vehicles — which include electric motors as well as an internal combustion engine — remain miniscule.
Of the 10.22 million vehicles registered in the U.S. through the third quarter, roughly 525,000, or 5.1%, were all-electric models. That’s up from 334,000, or 2.8%, through the third quarter of 2021, according to S&P.

The majority of the EVs registered through September — or nearly 340,000 — were Teslas, according to S&P. The remaining vehicles were divided, very unevenly, among 46 other nameplates.

But Tesla’s success in the market as well as government incentives have all but forced traditional automakers to make an effort in the growing EV segment.

The Ford Mustang Mach-E, ranked third in EV registrations, is the only non-Tesla vehicle in the top five rankings, S&P said. Those EVs were followed by the Chevrolet Bolt and Bolt EUV, Hyundai Ioniq 5, Kia EV6, Volkswagen ID.4 and Nissan Leaf.
S&P noted that the growth in EVs is largely coming from current owners of Toyota and Honda vehicles. Both of the automakers are well-known for fuel-efficient vehicles but have been slow to transition to all-electric models.

To help curb carbon and other emissions from traditional gas-powered vehicles, several states and the federal government are encouraging the transition to fully electric vehicles with incentives such as tax breaks.

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Without stating the obvious CNBC l doubt if Tesla were never in any doubt all the worlds legacy automakers would one day start making EV's, and start catching up. Tesla next smallest car they have coming might set the cat amongst the pigeons it will using different lighter cheaper low cost battery packs so its lot cheaper as well closer to base-top of the range will be priced to be make decent profit as well on roof, $25,000-£30,000 in China & $30,000 to $40,000 in the US?

Tesla will be doing the cheaper smaller cars

gm Electric are hoping to increase EV car making revenue globally to $50 billions in just 2 years if they can get up to speed using more robotics like Tesla get selfs just as lean fit more productive at making EV's that might be possible achievable, others will eat Tesla market share cake, GM are ramping up production of the Bolt EV will be selling it a lot cheaper to buy in the future, it's probably not going to be profitible but other EV's vehicles coming will be. gm Electric will be getting IRA tax discounts on every battery pack it makes, plus $7,500 incentives to buy its cars will bring the price down a bit.

It's one thing saying you are going to do small expensive EV's, yes IRA battery pack discounts & $7,500 incentive are great, but when EV's go mainstream the US taxpayer will eventually stop paying the incentives, it will be the automakers that do the impossible make small cars a decent tidy profit that will be the long term survivors.
 

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A financial analyst put it in an interesting way with 2 points he made:
1.)Tesla Technology in many ways is ahead of what the rest of the industry uses, but all the rest of the industry has to do is buy one tesla and tear it down to see what they have and where they are going.
2.) The rest of the WORLD...GM, Ford, VW, Toyota, Honda, etc, etc have a lot of great employees and there are hundreds of engineers (if not thousands) who have been given one basic goal...close the technology gap on Tesla. That doesn't mean they will pass Tesla in technology next month, but a lot of what Tesla had/has going for it...the lead will likely not be as large in the future as it is now.
 

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A financial analyst put it in an interesting way with 2 points he made:
1.)Tesla Technology in many ways is ahead of what the rest of the industry uses, but all the rest of the industry has to do is buy one tesla and tear it down to see what they have and where they are going.
2.) The rest of the WORLD...GM, Ford, VW, Toyota, Honda, etc, etc have a lot of great employees and there are hundreds of engineers (if not thousands) who have been given one basic goal...close the technology gap on Tesla. That doesn't mean they will pass Tesla in technology next month, but a lot of what Tesla had/has going for it...the lead will likely not be as large in the future as it is now.
Teslas have of course been torn down (just as other automakers' vehicles regularly are). So far nobody has found any of this advanced technology you speak of. Elon Musk has always been fond of SAYING that Tesla is more advanced in their manufacturing, processes, parts and systems designs. But every time anybody ever looked, they simply said, "We've been doing it that way (or used those exact parts, processes, etc.) for decades."
 

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Tesla should be commended for making EVs more mainstream but in the past few years, the brand has lost focus (thanks to it’s erratic CEO) and the serious manufacturing and development issues are piling up quickly.

Not that this is news to anyone but the company has a rapidly aging lineup, serious build-quality issues, and a number of future models with no concrete production timelines.

No one should be surprised that they’re losing marketshare.
 

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Tesla should be commended for making EVs more mainstream but in the past few years, the brand has lost focus (thanks to it’s erratic CEO) and the serious manufacturing and development issues are piling up quickly.

Not that this is news to anyone but the company has a rapidly aging lineup, serious build-quality issues, and a number of future models with no concrete production timelines.

No one should be surprised that they’re losing marketshare.
All fair assessments, but nonetheless Tesla was doomed to eventually lose marketshare to its numerous competitors.
 

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A financial analyst put it in an interesting way with 2 points he made:
1.)Tesla Technology in many ways is ahead of what the rest of the industry uses, but all the rest of the industry has to do is buy one tesla and tear it down to see what they have and where they are going.
2.) The rest of the WORLD...GM, Ford, VW, Toyota, Honda, etc, etc have a lot of great employees and there are hundreds of engineers (if not thousands) who have been given one basic goal...close the technology gap on Tesla. That doesn't mean they will pass Tesla in technology next month, but a lot of what Tesla had/has going for it...the lead will likely not be as large in the future as it is now.
They did that in 2012. Munro & Associates bought a Model S when it came out and tore it apart. They found some clever solutions, but for the most part it was old tech. They've done it with several Tesla's. The Tesla Model S used more parts to make the structure than the Big 3 would need to make the same structure. There is no "technology gap" with Tesla, not anymore. They are not ahead of the rest of the industry, in fact in some places they are behind more than 20 years. They aren't put together as well as everyone thinks they are.
 

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Tesla should be commended for making EVs more mainstream but in the past few years, the brand has lost focus (thanks to it’s erratic CEO) and the serious manufacturing and development issues are piling up quickly.

Not that this is news to anyone but the company has a rapidly aging lineup, serious build-quality issues, and a number of future models with no concrete production timelines.

No one should be surprised that they’re losing marketshare.
The Model S has been around almost as long as the Dodge Charger/Chrysler 300! :ROFLMAO:
 

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They did that in 2012. Munro & Associates bought a Model S when it came out and tore it apart. They found some clever solutions, but for the most part it was old tech. They've done it with several Tesla's. The Tesla Model S used more parts to make the structure than the Big 3 would need to make the same structure. There is no "technology gap" with Tesla, not anymore. They are not ahead of the rest of the industry, in fact in some places they are behind more than 20 years. They aren't put together as well as everyone thinks they are.
Tesla now has $20 billion in the bank and less than $3 billion debt, the fact that they haven’t applied upgrades to the S is exactly because all the focus has been on the 3, Y, and coming Cybertruck. Tesla 3 went from a similar messy mix of assembly parts to refined gigacastings replacing something like 76 parts.

Everything is possible but the fact that Tesla is making so much money of just two vehicles should tell us something, that the other products like S and X don’t really matter much at the moment….
 

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Tesla now has $20 billion in the bank and less than $3 billion debt, the fact that they haven’t applied upgrades to the S is exactly because all the focus has been on the 3, Y, and coming Cybertruck. Tesla 3 went from a similar messy mix of assembly parts to refined gigacastings replacing something like 76 parts.

Everything is possible but the fact that Tesla is making so much money of just two vehicles should tell us something, that the other products like S and X don’t really matter much at the moment….
They're making money off of 4 vehicles, not two...and letting the "S" wither isn't a good business model, especially with all the new competitors. The Cybertruck shouldn't be mentioned until customer cars on on the road, until then it's vaporware. Now I'm starting to see the "pyramid scheme" people have called Tesla. Regardless, losing market share is a given considering the competition available now. They're going to have to surpass some very big name companies with even deeper pockets.
 

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Marketshare here is a poor metric.

5 years ago, when Tesla was the only EV manufacturer, they had 100% marketshare.
Today, when every other major manufacturer is making an EV or even 2 EVs, obviously Tesla's marketshare is going to drop.
Agreed. Tesla has already done what it needed to - it made a name for itself and done something almost impossible, which is successfully creating a new car make in an industry littered with the carcasses of failed startups. They were destined to lose market share.

Tesla is entering a new challenge; it will quickly lose its distinction of being the only real player and will need to learn how to compete. One of its big edges right now is it hasn't needed to have any costly marketing - it might need to start advertising at some point. Though it still has one edge in offering cutting edge tech where the more conservative legacy auto makes will always be more cautious and take longer to bring new tech to market (more testing).
 

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GM, Ford, Toyota etc. will all catch up and offer both BEVs, ICE, Hybrids and maybe even some Hydrogen and Musk mobiles will not be in the lead anymore. I truly believe Teslas best days are coming to a close. Everyone else will build better quality (not hard to do honestly) with better looking product you can get serviced nationwide for less money. Just a matter of time.
 
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I have posted this in the past, but not for a while, and with the Tesla discussion I figured I'd bring it up again, see if anyone else had the same experience.

I have driven in, and have driven myself, most Tesla models, I have found them very uncomfortable and the ride absolutly punishing.

I'm not one to really look for a cushy ride. In the past 2 decades, I have owned a couple Camaros, compact Mazda 3's, Kia Souls....a Malibu, a CX-5, a Mitsu Eclips, Vue Redline, among other cars. Many of them not known for giving a luxury-smooth ride.

With that said, I have 2 times gone to local events where they bring in many EV's and let you test drive them. During them I have driven a Chevy Bolt and Volt, Nissan Leaf, VW, and a Tesla 3, Y and S (2 times). The Tesla, by far and away, were the harshest, worst riding cars. Again, with my past cars I can deal with a little of a rough ride, feeling some bumps, but every single Tesla was like it didin't have rubber wheels but instead you were riding on rocks.

I have considered a Tesla in the past (not seriously, but the thought entered my mind), and I understand the performance is great and some people like the styling. Just the ride, I cannot get over how most people can want that as a daily driver.
 

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Agreed. Tesla has already done what it needed to - it made a name for itself and done something almost impossible, which is successfully creating a new car make in an industry littered with the carcasses of failed startups. They were destined to lose market share.

Tesla is entering a new challenge; it will quickly lose its distinction of being the only real player and will need to learn how to compete. One of its big edges right now is it hasn't needed to have any costly marketing - it might need to start advertising at some point. Though it still has one edge in offering cutting edge tech where the more conservative legacy auto makes will always be more cautious and take longer to bring new tech to market (more testing).
Judging by Autopilot, more testing isn't necessarily a deal breaker. (although some of the trouble lies with the wetware behind the wheel......or in the back seat in one case)
 
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