During the fourth quarter of 2023, Tesla noted a new record for global EV sales, but its market share is not expanding as fast as in the past.
According to the industry data (trailing by twelve months), highlighted by Tesla in its Q4 financial report, the brand’s market share in the United States/Canada (counted together) recently reached 4%. That’s the highest level ever recorded, but there is now almost no growth, as the curve appears to be almost flat.
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Tesla EV sales growth slows down
In 2023, Tesla delivered a record number of over 1.8 million electric cars (38% more than a year ago). However, the growth rate in Q4 was below 20% (despite price cuts), and the year 2024 might be challenging too.
It seems like it’s difficult to increase the market share when the overall market also rebounded from previous years.
A similar, or maybe even a bit worse, situation is happening in Europe. The graph shows that Tesla’s market share marginally weakened from a near 3% level. It would explain why we saw the Model Y price reductions in multiple European markets.
Meanwhile, in China, Tesla continued to increase its market share, although it remains noticeably lower than in Europe and the U.S./Canada.
The key thing is whether Tesla will be able to increase EV sales and market share in 2024. The latest input from the company is that the growth rate is expected to be “noticeably lower” this year.
The situation might significantly improve for Tesla once the next generation of more affordable electric cars is launched in 2025. If it’s in late 2025, then we are talking about at least two years until the next big wave.
Tesla explains: “Our company is currently between two major growth waves: the first one began with the global expansion of the Model 3/Y platform and the next one we believe will be initiated by the global expansion of the next-generation vehicle platform. In 2024, our vehicle volume growth rate may be notably lower than the growth rate achieved in 2023, as our teams work on the launch of the next-generation vehicle at Gigafactory Texas.”
Since 2008, Tesla cumulatively sold about 5.5 million electric cars globally, and its 12-month output amounted to 1.8 million annually.