By: Mike Smith
According to data from Experian, Tesla Inc. experienced a significant rebound in sales in the United States during the first four months of 2023. This growth was attributed to substantial price reductions implemented by the company. Tesla’s registrations increased by 52 percent compared to the same period last year, demonstrating the effectiveness of CEO Elon Musk’s strategy of prioritizing volume over profit. Musk has set an ambitious annual growth target of 50 percent for Tesla’s global sales.
From January to April, Tesla’s Model Y crossover saw an impressive surge of 99 percent in new registrations compared to the previous year. The Model 3 sedan also exhibited healthy growth, with a 28 percent increase in registrations. On the other hand, the Model X crossover experienced a 15 percent rise in registrations, while the Model S sedan saw a significant decline of 67 percent. In total, Tesla accounted for 60.8 percent of the electric vehicle market in the U.S., with 211,842 registrations during this period. This represented a slight improvement from its 60.3 percent share in the first quarter.
Although Tesla does not disclose its U.S. sales figures, registrations serve as a proxy for measuring its market performance. Notably, Tesla no longer maintains a press office for providing comments on such matters.
Experian’s data revealed that Chevrolet secured the second position among electric vehicle (EV) brands in the four-month period, with 24,689 registrations and a 7.1 percent market share. Ford ranked third with 17,167 EV registrations, accounting for a 4.9 percent share.
The percentage of EVs among U.S. light-vehicle registrations increased to 7 percent through April, compared to 4.4 percent in the previous year. This share remained consistent with the first quarter. The total number of new EV registrations during this period reached 348,258, reflecting a 72 percent growth compared to the same period the previous year.
Tesla’s registrations in the first quarter of 2023 showed improvement compared to the preceding quarter, growing by 37 percent year-on-year. In April alone, Tesla recorded 56,482 new registrations, surpassing its monthly average of 51,787 registrations between January and March. Recent positive headlines about Tesla’s global sales estimates and agreements with Ford Motor Co. and General Motors to open its Supercharger network to their brands have contributed to its positive momentum. These announcements were made by Musk on Twitter alongside Ford CEO Jim Farley and GM CEO Mary Barra.
During a conference in Texas, Musk acknowledged that opening Tesla’s charging network might place the company at a competitive disadvantage but stated that doing so would benefit the rest of the industry.
Throughout this year, Tesla has made several adjustments to its vehicle prices, including substantial price cuts in mid-January. These global reductions were implemented in response to signs of declining sales growth for Tesla.
Additionally, Tesla’s U.S. sales have been boosted by the federal tax credit, which provides buyers with up to $7,500 in incentives. Before January 1, Tesla buyers were not eligible for this incentive because the automaker had reached its credit limit under previous regulations.
By combining price reductions and the federal EV incentive, buyers can potentially receive a $25,000 discount on a Model Y compared to the previous year. It is important to note that the availability of the tax break is subject to eligibility requirements, and state incentives for Tesla buyers are also available.
The base price of the Model Y, which was $67,440 with shipping at the end of 2022, has been reduced to $49,380, including shipping, and now qualifies for the federal credit. Similarly, the base price of the Model 3 sedan decreased from $48,440 with shipping at the end of last year to $41,880 with shipping, making it eligible for the incentive.
Despite concerns about a potential economic downturn, analysts highlight that Tesla continues to make progress in various business sectors, such as the expansion of its Supercharger network, battery production, and lithium refining. They praise Elon Musk’s strategic prowess, noting his ability to outmaneuver competitors in multiple arenas.
In the U.S. luxury vehicle market, Tesla’s new registrations of 211,842 surpassed the combined figures of its two closest competitors, encompassing both electric and gasoline-powered models. BMW ranked second with 114,889 registrations, followed by Lexus with 95,511. Mercedes-Benz secured the fourth position with 86,033 registrations, and Audi claimed the fifth spot with 72,582, according to Experian.
Tesla’s vehicles are considered luxury vehicles due to their pricing and the demographic of its customer base. When considering full-electric vehicles across all segments, three of Tesla’s four nameplates made it into the top 10 in terms of new registrations from January to April. The Model Y ranked first with 127,541 registrations, followed by the Model 3 with 72,259 registrations. The Model X secured the sixth position with 8,216 registrations.
Source: AutoNews (subscription required)