It goes without saying that the world-famous car manufacturer Tesla is synonymous with electric vehicles. Not only has Tesla been developing cutting-edge vehicles for over 15 years, but it’s also spearheaded the EV infrastructure development in the UK. It’s therefore fair to say the EV market we know and love simply wouldn’t be the same without Tesla.
But it does seem that there’s trouble in paradise, with Tesla recalling their new Cybertrucks, making a large amount of redundancies, reporting its first sales decline in four years and seeing their stock price drop.
So what’s really happening? Is this merely a bump in the road, or are we witnessing the reshaping of Tesla?
Just how significant has Tesla been in the EV industry?
Tesla and Elon Musk have been instrumental in shaping the market for EVs as we know it. Its very first vehicle brought to market, the Tesla Roadster, was the first motorway legal, serial production, all-electric car to use lithium-ion battery cells, and the first production all-electric car to travel more than 244 miles per charge. This was the first time an electric competitor was able to rival equivalent offerings such as the BMW Z3 or the Mercedes SL series.
Product innovation didn’t stop there, and Tesla now boasts world-leading self-driving technology. This allows drivers to fully take their hands away from the steering wheel, with the car capable of manoeuvering, indicating and detecting hazards just like a human driver would. While the system isn’t perfect just yet, you can’t deny that what Tesla has created is extremely innovative and will potentially change driving as we know it. Tesla were also the first to introduce maps with integrated charging, they have a bump at every chargepoint so you know exactly where to stop. Their car isn’t just a car, but an entertainment system for children. When you own and drive a Tesla, you’re driving a vehicle that has so much more than has been offered in the past. It truly is a luxury, competing with the giants of the automotive industry.
Step away from the cars themselves and Tesla has still been hard at work developing charging infrastructure across the UK. There are now more than 1400 superchargers installed in over 140 locations across the country, with many of them also accessible for non-Tesla drivers, meaning many motorists can benefit from Tesla technology.
What problems are Tesla currently facing?
Tesla has been in the headlines recently, but for all the wrong reasons. Alongside the bad press already surrounding the Cybertruck and its rather lackluster offroading capabilities, it’s also having to recall 2024 models due to the accelerator sometimes getting stuck – an extremely dangerous fault.
It’s also been revealed that Tesla’s global car sales have dropped some 13% when compared with the first quarter of 2023, marking the first decrease since 2019. This means that Tesla’s profits are down a huge 55%, and share prices have also slumped. Whether this is due to a drop in demand for EVs in general in certain countries or a shift in customer preferences to other EV manufacturers remains to be seen.
Tesla once positioned itself as the premium manufacturer to beat, and already had a well-established market reputation long before governments started to introduce ICE phase-out deadlines and tax incentives to switch to EVs. Now traditional manufacturers such as BMW, Mercedes, Porsche and Audi have all introduced several fully electric vehicle lines, as well as newcomers such as BYD, it could be that Teslas simply don’t have the same appeal they once did in the eyes of many consumers.
What’s next for Tesla?
Despite the hurdles Tesla has faced recently, you’d be wrong if you were thinking it’s all doom and gloom. While Tesla shares initially dropped after announcing its sales figures for Q1 2024, these quickly rose again when the company vowed it was going to accelerate the launch of more affordable models, potentially marking a change in the long-term Tesla narrative that its electric vehicles aren’t affordable.
Elon Musk also doesn’t plan to let Tesla fall by the wayside on its digital technology too, as it’s been revealed that Tesla are working on integrating ride-hailing technology into their app to take on the likes of Uber. And Tesla isn’t just an electric car company: it also has a power storage business that may even potentially overtake its electric vehicle business in the near future.
Tesla has been leading the charge for EVs for some time now, and despite the arrival of competitive car companies, price cuts and fluctuating stock prices, there’s no doubt that it will still be here for the foreseeable future, even if its market position changes within the electric vehicle industry. As of 2023, the electric vehicle industry has a market valuation of just over $500 billion, and projected market growth currently puts the estimated market valuation at over $1.5 trillion by 2030, marking a staggering $1 trillion increase in less than a decade. Even if Tesla did experience a drop in sales, it remains an incredibly valuable car company and has already positioned itself very well as a key market player for all things EV. It’s this holistic approach to being an electric vehicle company that sets Tesla apart from the rest.
Whether you want to get behind the wheel of your first Tesla, or want to try another brand of EV, we have electric vehicles from all the best brands here at P + B. If you need help choosing your first EV and want to make the move away from the traditional car industry in favour of greener vehicles, get in touch with us.
