This Is Why Tesla Is Still Way Ahead Of The Game In US Electric Car Sales - HotCars

Tesla is simply dominating. Be it design, performance or sales, Tesla seems to be perched on the top of the market.

Since the emergence of Tesla, with their sporty Roadster model, introduced to the automotive manufacturing scene in 2008, Tesla has relentlessly continued to push ahead, bringing the advent of electric vehicles (EVs) into normal reality. Irrespective of whether you love or hate Teslas, it cannot be denied that they were instrumental in paving the way for many other companies to start producing EVs. More practically, just think about the availability of EVs in the early 2010s compared to now. Most people have considered buying a Tesla whether they admit it or not, and many people are actively buying Teslas, leading to massive, consistent increases in Tesla sales.

Let's look at what caused these massive increases in Tesla sales and examine why Tesla is still ahead of the curve in EVs sales in the US.

Unique Business Model Shows Tesla Is Listening To Consumers

Front 3/4 view of a red Model S Plaid on the move — Tesla

Before jumping into what makes the Tesla business model so radically different, it is worth briefly explaining the traditional car dealership model to set up the point of comparison for consequent analysis.

The traditional process of buying a car from a car dealership is pretty consistently disliked all across America. A CNBC article has discussed some of the key problems with the traditional dealership model and identified one of the biggest issues as the difficulty most consumers face in walking away from high-pressure sales tactics. This is highly dangerous as the free-market economy norm of individual autonomy and decision-making in the purchase of goods and services does not seem to be occurring in car dealerships all across America. However, before being consumed in microeconomic analysis, let's take a step back and look at what actually happens in these dealerships and how Tesla challenges these things.

First and foremost, most employees in traditional car dealerships work off commission, meaning that the majority of the money that they earn is dependent on how many cars they can sell. Consequently, this can often lead salespeople to be very pushy and sometimes aggressive, as their payday is dependent on whether you buy the car or not. Additionally, this lack of certainty can also create high levels of stress for the salesperson. If that wasn't enough to put you off the dealership model, there are also a variety of fees attached to buying a car from a dealership which are often not mentioned or mentioned late, and increase the price of a car significantly.

Tesla has stood directly against this traditional model, employing their staff with hourly wages, making Tesla 'salespeople,' if they can even be called that, calm, helpful and ultimately not financially dependent on whether you purchase a car or not. Additionally, Teslas are essentially ordered online meaning that the Tesla stores do not have the same level of fees that are added on purchase as ordering a Tesla at home is the same as ordering one in store; fully online.

Potent Performance Problematizes Rivalry

The quality and performance of Tesla is another key reason why Tesla sales are booming.

Sure, there are significantly more companies offering EVs than in the early 2010s, however, very few come near to or supersede the performance of Teslas. There are simply a variety of different reasons why Tesla reigns supreme and their technology remains unmatched. Be it the driving range, acceleration or the battery and its charging, there is something to be said of specialization and how it benefits the consumer. This is in no way meant to ignore the advances made by other EV manufacturers, rather, it is simply a comparison of the current state of EVs.

Range is probably one of the most significant specifications in deciding which EV to buy and Tesla continues to dominate, explaining why it sells so well. Having ample range off one single charge is a massive selling point to someone looking to switch from a traditional internal combustion-engined (ICE) car to an EV, especially considering that most ICE-powered cars tend to have pretty decent mileage off one tank of gas.

Future Forecast Based On Current Trends

So where does all of this leave us?

Well for starters with increases in petrol prices, EVs sales have increased generally in the US and quite rapidly too. In understanding this, it can be deduced that the market for EVs is most likely to increase, meaning that the number of buyers looking to buy an EV will also increase, giving both Tesla and other companies a chance to increase their EV sales. Admittedly, Tesla does have the leg-up in the EV game, not only having really high-performing cars but having dominated the market, not only in the US, but in Europe and globally as well, with their Model 3 being the best-selling EV.

More technically, Tesla stocks have skyrocketed, hitting insane highs despite being the most shorted stock on the market in 2019. The radically different business model and performance of Tesla's are the reason that Tesla leads US EV sales. The current time remains highly critical for other companies wishing to catch up to Tesla before they pull away for good.

Via: CBNC and BBC