Tesla Motors Faces a True Challenge

Ford 'Mustang Mach-E' Erodes Tesla Market Share... Volkswagen Becomes No.1 Electric Car in Europe

Tesla Model 3 [Image source= Reuters Yonhap News]

[Asia Economy Reporter Park Byung-hee] As internal combustion engine car manufacturers have begun full-scale production of electric vehicles, Tesla Motors, which had led the electric vehicle market, is now facing a real challenge, analyzed the Wall Street Journal (WSJ) on the 11th (local time). WSJ pointed out that Tesla's market share in the US and European markets has started to show signs of decline.

In the United States, Ford Motor Company's electric sports utility vehicle (SUV), the Mustang Mach-E, which began sales last December, is gaining popularity. Market research firm Motor Intelligence reported that 12% of electric vehicles delivered last month were Mustang Mach-Es. As a result, Tesla's market share in the electric vehicle market dropped to 69% last month, down from 79% on an annual basis last year.

In Europe, Tesla lost the number one electric vehicle brand position to Volkswagen. According to Schmidt Automotive Research, although the European electric vehicle market more than doubled last year, the number of Tesla vehicle registrations was only 98,000, an 11% decrease compared to 2019. On the other hand, Volkswagen's electric vehicle registrations increased more than threefold, approaching 180,000. Tesla's market share in Europe fell sharply from 31% in 2019 to 13% last year.

As established internal combustion engine car manufacturers such as Volkswagen and Ford have made large-scale investments in the electric vehicle sector in recent years, the prediction that Tesla would face challenges is becoming a reality.

Independent analyst Matthias Schmidt said, "Suddenly, Tesla has competitors," adding, "For Tesla, increasing production volume is important."

Tesla currently operates factories in Fremont, Ohio, USA, and Shanghai, China. This year, it plans to start operating two new factories in Austin, Texas, and Berlin, Germany. It also plans to expand the production capacity of the existing two factories. Tesla recognizes the importance of expanding production capacity. CEO Elon Musk said, "Once the new factories start operating, efficiency in delivering vehicles will improve."

In particular, the Berlin factory is expected to provide a turning point for Tesla in the European market, where it has been struggling. With local production in Europe, there are forecasts that Tesla could reduce the price of the Model 3 by up to 20%.

Although sales in Europe decreased last year, Tesla's global vehicle deliveries increased by more than 30% compared to 2019, reaching about 500,000 units. This was thanks to increased production at the Shanghai factory, which nearly tripled deliveries in the Asia region.

This content was produced with the assistance of AI translation services.