Yes, Tesla Sales Have Dropped, But It’s Still The World’s EV Sales King

Another week, another hot headline in the mainstream media, happy to report that things aren’t going well for Tesla Motors. Indeed, Q1 2024 results show a net drop in vehicle sales for Elon Musk’s electric vehicle (EV) juggernaut, down 8.5% versus last year for the same period with 386,810 vehicles sold versus 423,000.

This is attributable to several factors. Yes, it’s true that the entire EV industry has been undergoing a cooldown since the start of the year. While still growing, their market share isn’t as high as it was last year for the same period, and it could keep slumping over the following months.

EVs are now entering the thicker part of the new technology adoption curve, where they now face less tech-savvy consumers who aren’t necessarily willing to deal with the same set of compromises as the early adopters. Tesla is now facing new competition in the EV space, from basically everyone. It also recently slowed down the old Model 3’s production to make way for the newly updated, 2024 model.

Yet, none of that is preventing Tesla from being the EV sales king worldwide. As a matter of fact, the latest sales data shows that it’s even overtaken its arch nemesis, Chinese giant BYD.

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BYD’s 43 Percent Drop

The biggest news in the world of EVs isn’t Tesla’s 8.5% drop in sales, but BYD’s nearly catastrophic 43% downfall quarter over quarter. Its global sales went from a 526,409 peak at the end of 2023, to a mere 300,114 EVs sold during Q1 2024. Although BYD did see some much-needed growth in March after responding to Tesla’s price war, its quarterly situation still allowed Tesla to regain the crown as the best-selling electric vehicle brand worldwide.

It’s also worth underlying that the EV cooldown is also happening in China. While BYD and Tesla are still holding on strong, other important Chinese players, like Nio, are feeling the wrath of a slowing demand.

EVs Are Entering A Dark Era

So, what can we expect over the following months? Although the automotive industry is currently bonifying its EV offering with models that cater more and more to the masses, like the impressive Kia EV9 three-row SUV, EV sales will most probably continue to slumber as demand slows down. Through it all, carmakers will attempt to slither their way through a myriad of new governmental policies, each more confusing than the next.

Meanwhile, EV disinformation continues to spread on social media platforms, and negative EV sentiment from dealers won’t help the market in the short term. And don’t get me started on how the electric car has somehow become a political weapon amidst the upcoming US presidential election. It’s even more alarming that this is all happening during a state of climate urgency.

As for Tesla, I wouldn’t worry much as the carmaker has proven its resilience to resist a wide range of different disturbances. The heavily updated Model 3, as well as the controversial Cybertruck are hitting US and Canadian roads as I write this. Results from Q2 2024 could therefore come with their share of positive surprises.