One of my favorite headline formulations ever comes from pre-Defector Deadspin, when Tim Marchman complained that Game of Thrones author George RR Martin seemed to be doing anything but finishing his series of books. Specifically, Marchman headlined his prophetic article “GRRM Has No Pages.” That was 2015, it’s been almost a full decade, and the next book still isn’t out.
Allow me to do my own twist on this formula by pointing out what the numbers seem to portray, which is that Tesla lacks the right cars. This has nothing to do with politics, or self-driving, or AI. Some folks want Tesla to be anything other than a car company, but it’s still a car company for the moment, and when it comes to products it’s falling further and further behind the competition.
Let’s start in China, where Tesla slipped way back in the sales rankings. The best-selling car there in April was the Geely Star Wish. It’s a car you’ve maybe never heard of, but it’s one of many successful small EVs. One of the other super popular diminutive electric cars is the BYD Seagull/Dolphin/Surf, which just went on sale in Europe where… Tesla has fallen behind a Chinese brand for the first time ever.
That’s not to say that all is peachy keen for people who make electric cars, as overproduction is still an issue. Plus, Chinese consumers seem to want more affordable cars, just like everyone else. This isn’t just an issue for Tesla as the dream of expensive EVs continues to be difficult to achieve for a lot of automakers, including Porsche.
Things are slightly better for Tesla in the United States, where sales inched up a bit in April. There, too, I see some troubling signs.
Check Out This Geely Star Wish
Technically, this is a Xingyuan, which translates to: Wish Upon A Star. It’s generally referred to as the Star Wish in English, and that’s how I’ll refer to it. For all the talk of upstart automakers like Nio and Xiaomei, it was a B-segment EV from the well-established automaker Geely that took China’s sales crown in April.
Here’s how Nikkei Asia describes it:
The top-selling car in April was the Star Wish, an all-electric sedan by Geely’s Galaxy EV brand, according to car marketplace app Dongchedi. The lowest-end version of the model comes with a driving range of 310 kilometers and is priced at 68,800 yuan ($9,500), compared to the Tesla Model 3, which starts at 235,500 yuan.
“It is equipped with a CATL battery, has lots of room for storage and has Level 2 driver assistance technology,” said an employee of a Geely Galaxy dealer on the outskirts of Shanghai. “The value for money is very high.” She added that the car, which comes in bright colors, is popular among women with children. The store offers 5,000-yuan discounts for some higher-end versions of the model with longer driving ranges.
It was launched last fall to compete with the curiously inexpensive BYD Seagull (more on that later). Overall, the Chinese market continues to be incredibly competitive and, as that article points out, the push is to get less expensive cars:
“With persistent oversupply, the price war will prolong,” said Claire Yuan, director of corporate ratings for China Autos at S&P Global Ratings. “Carmakers are introducing more low-price models to grab share in the mass market.”
Unlike the United States, many electric cars actually undercut their gasoline equivalents in price. This has made things harder for all sorts of companies, including Tesla, which has fallen from its high perch, according to CNEVPost:
Tesla’s retail sales in China were 28,731 units in April, down 8.6 percent from 31,421 in the same month last year.
The US electric vehicle (EV) maker ranked No. 8 in China’s NEV market in April with a 3.2 percent share, down from a 7.5 percent share in March and down from 4.6 percent a year earlier.
Tesla dropped five spots in China’s NEV market in April compared to its No. 3 ranking in March.
Tesla was reportedly trying to build a cheap EV, but that probably became the Cybercab. Instead, the company is likely to put out a de-contented Model Y. [Ed Note: I think that could be a great value. I have no issue with using the Model Y as the basis for a cheaper car. -DT]. Rather than focus on the bottom end of the market, Elon Musk harnessed his hopes to the Cybertruck, which hasn’t exactly been a hit.
It’s hard to make money on cars that cost 1/4 the price of a Tesla Model Y, so I get the appeal of a Cybertruck. It does seem like the market for expensive EVs is saturated, and so lower-priced EVs are the way forward until there’s some big advancement in battery technology/range.
While Tesla does enjoy some support from China’s government and produces cars in the country, it’s not a Chinese automaker. Therefore, it might be difficult for Tesla to get the same kind of subsidies necessary to compete on the lowest end of the market. It could (and should) probably offer something more affordable.
BYD Outsells Tesla In Europe For The First Time Ever
There’s no way around it, Tesla’s European sales were hurt by CEO Elon Musk’s involvement in far-right politics, but I think the bigger issue for Tesla isn’t that, it’s competition. Tesla is just selling the same things, and other automakers are offering a way wider range of vehicles at better price points. Who wouldn’t want a Renault 5 E-Tech?
It’s one of the big reasons why Tesla got outsold by Chinese automaker BYD in Europe for the first time ever, according to data from Jato Dynamics via Bloomberg:
BYD Co. sold more electric vehicles in Europe than Tesla Inc. for the first time, overtaking the American brand that’s long led the continent’s EV segment.
China’s leading automaker registered 7,231 new battery-electric vehicles in April, according to market researcher Jato Dynamics. That was up 169% from a year earlier, vaulting BYD into the top 10 brands by EV sales. Tesla placed one spot back as its registrations plunged 49%.
“Although the difference between the two car brands’ monthly sales totals may be small, the implications are enormous,” Jato Dynamics analyst Felipe Munoz said in an emailed statement. “This is a watershed moment for Europe’s car market.”
It’s bad. It’s real bad. EV registrations were up 28% across Europe and the UK, while Tesla’s sales slumped by 49%. On the high-end, there are the traditional European automakers like BMW and Volkswagen. On the lower end, budget VW brand Škoda has been killing it, thanks to vehicles like the sub-Model Y Elroq EV.
As if that wasn’t troubling enough for Tesla, the automaker now has to compete with the BYD Dolphin Surf in Europe. This is a bigger, more European-ified version of the sub-$10,000 Seagull. Before the Star Wish, the Seagull was regularly the best-selling car in China and is still BYD’s best-selling model. It wasn’t available immediately in Europe as the company made changes to make it more appealing to the market. This means the car, called the Dolphin Surf, now costs around $22,000 according to Inside EVs.
Like its larger brother, the Dolphin, the BYD Seagull has a few specific revisions to make the car more palatable for audiences in Western Europe. They both offer roughly the same Lamborghini-in-the-city esque styling, but the European market version is a full 8 inches longer. Most of the length appears to have gone to the revised nose and tail, which protrude out a bit more than the ones on the Chinese version.
There have been some under-the-skin enhancements, too. The 75 horsepower motor is gone; now the Dolphin Surf comes with either 87 horsepower in its lower Active and Boost trims or 156 horsepower in its top trim, called Comfort. The 30 kWh battery is still there in base Active, but the top two trims have a new 43.2 kWh battery, which isn’t available on its Chinese cousin. This may not sound like a lot of power, but keep in mind the Seagull/Dolphin Surf is about the same size as the old Chevrolet Spark EV.
I’m not saying anyone would buy these cars here. I don’t know that even a larger one would sell in the United States, but it’ll sell in Europe. It obviously sells in China. There are a lot of places where it’ll sell. In France, where the European model was just revealed, the cheapest Model 3 is about $40,000, or almost twice as much. The Model 3 is more car and a better car, but it’s also an extra $20,000.
Tesla Sales Were Up Slightly In The United States In April
While Tesla’s sales are dropping in markets like Europe and China, where EV sales are growing, the opposite is happening in the United States, where the EV market here saw a 5.6% year-over-year drop. A lot of this has to do with people panic-buying EVs at the end of 2024 and the beginning of this year, as most people see the EV tax credit likely being phased out soon. This pulled forward a lot of sales, and fewer of those sales went to Tesla than in the past, for whatever reason. If you’re not convinced by the political argument, it’s possible consumers were just waiting for the redesigned Model Y.
It’s here now, and they’re selling, just not at a huge clip yet.
While most manufacturers saw a month-over-month decline in volume, GM, Tesla, and Nissan reported notable growth in EV sales; Ford, Hyundai Group and VW Group experienced declines. Tesla’s market share remained below 50%, but it increased by 3.7 percentage points in April, driven by the success of the Model Y, which sold 25,231 units and held a 25.1% market share. GM brands had a strong month as well, achieving a combined market share of 14.4%, a 2-percentage-point increase from the previous period. Uncertainty in the market and tariffs, however, will continue to impact EV sales going forward. A recent consumer survey conducted by Cox Automotive indicates that nearly half of the respondents believe tariffs will have a significant impact on their decision to purchase an EV.
With the familiar caveat that Tesla still accounts for slightly less than half of all EV sales in the United States, this feels like fairly mid news for the automaker. The Cybertruck has seen price drops, there’s a brand new Model Y on the market, and they’re up less than 4% off a bad month.
If this were a traditional automaker, I’d be quite worried. It’s not building the products more customers want, its big new revision isn’t yet gaining huge traction, and its big product swing (the Cybertruck) is flailing. I just don’t think Tesla has the products to compete.
Now, there are two reasons why none of the above might not matter in the long run, but they’re both big “ifs”:
- The de-contented Model 3/Model Y thing is really cheap enough to be competitive with the Honda Civic/Toyota Corolla even without the tax credit. A $25k thing that’s roughly Model Y-shaped is a tempting prospect, especially if the Elon Musk-of-it-all doesn’t concern you.
- People do really like and use the Tesla Cybercabs in Austin, and the company is able to scale up the true Cybercab.
We’ll see.
It’s Not Easy For Porsche, Either
There will always be a market for fancy electric cars, even if more of that market (I think) will get swapped over for hybrids and EREVs.
How big of a market will it be, though? That’s my question. Porsche launched an IPO in 2022 on the concept that the company would “redefine the concept of modern luxury.” That hasn’t happened yet. There’s an anonymous quote from a Porsche insider in Manager Magazin that I think explains the problem so well:
A good two and a half years later, the strategy appears to be faltering at a key point. “Unlike with combustion engines, electric drives don’t allow you to differentiate yourself sufficiently from cheaper manufacturers,” says a Porsche insider. “Luxury and electric vehicles don’t seem to fit together yet.”
Or, as one of the company’s top managers puts it, “this is a real challenge.”
This is a challenge for everyone. Back in 2003, my BMW came with a relatively powerful and luxurious inline-six engine. You couldn’t build a car that felt as solid or performed as well at a much lower price or, at least, no one else did. While a Lexus GS at the time was competitive, it was only marginally cheaper.
With EVs, the biggest luxury is often still range, and while more battery is often required to achieve that, it can also be achieved with better and more efficient technology. Tesla has eaten Porsche’s lunch in the United States by building cheaper and faster cars with better range. I may like the way a Taycan looks and feels more than a Model 3 Performance, but a Model 3 Performance is like half the price.
What I’m Listening To While Writing TMD
Kelly Clarkson has a new song with “Where Have You Been” and it’s pretty good. I’m a Kelly Clarkson enjoyer.
The Big Question
Am I wrong? Does no one want a sub-$25k Tesla? Or Ford? Or whatever?
Photo: Geely Galaxy
I think Teslas are the right cars, the problem is it the wrong company. I very much like that they don’t change much, and other than apparently being part of a stock scheme with the full self driving and taxis and whatever the hell else there is that they promise, but basically the cars are pretty nice. The company, the guy who runs it and just about everything else about Tesla is toxic. No car is going to fix that. people who are inclined by an EV don’t want Teslas and people who otherwise might want to buy a Tesla don’t want EVs.
I like how Teslas don’t change much the same way. Volkswagens didn’t change much for years and years and just fixed the details. The control over software and parts I very much do not like, but that seems to be true of most brands.
Until Tesla can fix its branding problems, it will be as though you still had to buy Volkswagens from Adolf Hitler. VW has shown how to get over bad branding and toxic figurehead problems. Hopefully the rest of the country won’t have pay the price VW’s home market did.
“Am I wrong? Does no one want a sub-$25k” the answer is Yes and No.
1st thing is the amount of stupidly expensive ADAS that the US requires on cars these days, makes the 25K vehicle tough to even make and still net any sort of profit. Shareholders still expect 30% Profit margins generally, so you have to sell 2 25K cars to net the same profit in dollars that companies see on the average 50K car these days. Also small car sales are generally a tough volume sell and they are on the thin end of the bell curve as far as wants go.
With electrics though, the real concern for most is where to charge, how quickly it can be done and how often do you have to do it. With limited infrastructure still out there, and the majority of the chargers broke or being camped on because they are level 2 and take many hours to charge most cars still. this is still an issue for sales. yeah I get the idea of charging from home, but it still is not an option or the desire of a lot of people, specifically those looking for small and/or cheap rides.
It’s part of this trend in American business, where they would rather sell less of a more expensive thing, than more of a less expensive thing, even if the profits are equal. So now the theatres charge you $25 a ticket, but have half the seats as before. There needs to be some kind of incentives to reverse this ‘upmarket’ push in everything.
“There’s no way around it, Tesla’s European sales were hurt by CEO Elon Musk’s involvement in far-right politics, but I think the bigger issue for Tesla isn’t that, it’s competition”
Nah… in the EU… definitely the politics is the biggest factor. But for the EU, the cancelled ‘Model 2’, a smaller model slotted below the Model 3, would have been a slam dunk for that market… and many other markets like India and China.
If Musk hadn’t done the idiotic politics thing and carried on with the Model 2 project, Tesla sales would likely have continued to grow.
For North America, a discontented/basic version of the 3/Y would sell better as North Americans prefer larger vehicles.
The #1 vehicle that Tesla sells that needs a decontented version is the Cybertruck
And I think Tesla should make a smaller conventional-looking pickup truck based on the Model Y.
And they need to finish getting the Semi into production and make truck variants based on the Semi… like single and dual axle box trucks and maybe even a transit bus.
But no matter what Tesla does, Musk’s politics will be a drag on the company for the foreseeable future
I personally won’t touch any Tesla until Musk leaves and sells off his stake.
Maybe have JB Straubel take over…
Musk is going to have to admit he was wrong about the styling on the dumpster fire that is the Cybertruck. At the price point that it is currently it also sits in the Hummer price arena. if I am somehow able to get 100K through my head to buy a truck, the Hummer is definitely the more appealing choice here.
Nah… the BIGGEST thing Musk was wrong about was thinking that befriending Trump and helping him get elected was a good idea.
The next biggest thing he was wrong about is what he and his DOGE-SHIT group call “government waste”… and the callous ways he got people fired.
And the way he fired the whole supercharger team just because he had a disagreement with the person running the team was also wrong.
And how he’s procreating and then proceeding to be an absentee father with different women is also wrong.
And how he uses one of his small kids as a human shield at public events is also wrong.
This is all stuff that makes me say “I don’t want to do businesses with any company this asshole in charge of”
And I know there are millions of former Tesla fans like me who feel the same way.
The styling of the Cybertruck isn’t one of the things he was wrong about.
The crazy styling helped get attention and something like a million pre-orders
But it’s too damn expensive. Far more expensive than initially announced. Which is why many of those pre-orders disappeared.
If they want them to sell, they have to bring out lower trim RWD versions that they initially announced years ago for an inflation adjusted $39K that they also claimed the starting price would be.
And personally if I was shopping in that segment, I’d pick the Hummer, F150 Lightning, the Rivian R1T or anything else over the Tesla… and the biggest reason for me would be Musk’s politics.
It’s unfortunate as I like the design of Teslas.
And I feel bad for the many people who worked their asses off building up Tesla only for Musk to screw the pooch doing stupid shit like the politics, the firing/rehiring of the supercharger team and other stupid/deplorable shit.
To answer your big/last question, No. nobody wants a car decontented (screw spell check and I tried a bunch of spellings) to the point to get to that price. Roll-up windows? We can go on to manual door locks and a rinsible steering wheel sans airbag. No thank you.
I am fine with all of that removed, especially the steering wheel air bags, but I think the price delta will be far less than people think. The other stuff that NHTSA requires like camera’s, sensors, and so on still cost money. also the airbags would have to be removed from NHTSA requirements.
How anyone can even contemplate buying a Tesla as long as the brand has not thoroughly and unequivocally disconnected itself from Nazi Elon is beyond me. I just don’t get it. How can you support this abomination of a supposedly human being?
A $10k or $20k BYD Seagull will always outsell a $45000 Model Y just like a Honda Civic will outsell the Acura MDX. They aren’t comparable beyond the fact that both are EVs, all other things being equal, people will generally choose the cheaper thing that does what they need it to do.
Yes, Tesla needs to decide if they want to compete at the low end of the market, Volume Uber Alles etc.. BYD likely makes very little if any profit on their cars in China, and thus prices them far higher elsewhere, same with the other brands in/from China, and that is why they are desperate to sell them everywhere else.
Instead of harping on how Tesla is being outsold by far cheaper vehicles, how about a breakdown showing the localized and worldwide volumes of the actual market segment competition such as the various Teslas vs the BMW EVs, the Mach-E, the Lexus and Toyota, and whatever China has in both China as well as in Europe.
I do not disagree at all that Elon Musk is driving some/many people away (but perhaps not in all places, for example does anyone in India actually give a crap about his politics?) and costing his company sales, HOWEVER I also think you guys (as well as much of the regular media) are being quite disingeneous in how Tesla sales are being portrayed. Sure, they need to DO something like introduce some different cars/models/pricepoints if they want to keep all the volume, but their market share was always going to be nibbled away at every time someone else comes out with another competitor.
Yes, the CT is/was a massive failure, perhaps it will be a wake up call, IDK, but where’s the breakdown in exactly how many of those have sold and are continuing to sell vs the Lightning, Silverado EV, Sierra EV, and the Hummer pickup version EV. Are those others trucks killing it as far as sales go in the market place? I doubt it, they are likely all objectively failures when compared to their ICE equivalent sales numbers. (But I could be wrong, honestly haven’t looked into it, that’s why I come here and hope to read it here…)
Just like in the USA Tesla used to be #1 in Europe with more than 50% market share. Today they are no longer in the top 5:
#1 – VW – 26.5% market share
#2 – BMW – 11.0%
#3 – Stellantis – 9.7%
#4 – Hyundai – 8.1%
#5 – Geely – 7.8%
(Tesla has 6.3% of the EU EV market today)
One of the ways automakers could drastically reduce the costs of their EVs is to ditch the expensive alphanumeric names. Just name them with a real world (or close to) word. BAM, Bob’s yer uncle. Now you can compete with a Seagull or Dolphin. It’s so obvious folks!
You jest, but every time they an automaker decides “we should give this car a more normal name because the Eagle I-Thrust E-Tron Prime Q is a mouthful” it costs them time and money for trademarks, new emblem tooling, new documentation, new marketing literature, etc, etc.
I would love a sum $20K EV to be a third car to save our other two for our hobbies. But even then the economics may not work out as sub 10K used car would be cheaper (minus repairs).
The general population seems like they are still not into Bev at this point. But more and more people are interested. The best way to get them into them seems to be cheap to have and maintain. Some of the lease deals you see are crazy and in turn more of the obscure car that has the crazy lease deal is on the road. The Ayria is the prime example I’m not sure they even really advertised it. It just kind of showed up one day. People generally don’t know what it is but they started doing lease deals and you stated to see them. It seems like it’s not $25k it’s under $15k where you get the movement now. There are $25k cars available that are ok but people aren’t buying. If someone comes out with a small car under $15k and a small truck that’s really under $20k they will sell. It probably needs to be done Rivian style too people hate dealers. Basically the north American BEV kei.
Looks matter and the light bar on the current model Y simply doesn’t work. It’s just too proboscisy. Add in a dash of Neo-Nazism and you have a two ingredient recipe for a sales disaster.
The CT is a joke, the S ancient, the X seems utterly forgotten, and the 3 is not a crossover. The chief executive has lost all interest in cars after the CT failed and openly states they are no longer a car company.
Instead they have declared themselves winners of an autonomous vehicle race they already lost. Waymo has them beat. AI is not really patentable and so no one will retain any real lead. There’s just nothing special at all about Tesla. I also believe that if the political winds change Musky is in for a real reckoning over his fraud and lies.
My overall feeling for Tesla right now would best be described as, Ewwww.
Agreed on the Y refresh, and I even extend it to the 3 refresh. Both are uglier than the car they’re replacing, but look enough like a mid-cycle refresh that it’s not clear if there are any performance upgrades with the new version (are there? I don’t even know).