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Tesla's California market share tumbles despite aggressive price cuts
- malermeister 4y agoBuying a Tesla used to be an effective way of liberal virtue signaling for the much-despised "coastal elites". Now that Elon has gone fully mask-off, it might as well be the Trumpmobile.
- CharlesW 4y agoI also wonder if the price cuts are a reaction to market saturation. They as common as Camrys in mid- and higher-income areas in California.
- decafninja 4y agoAren’t they literally nicknamed the California Camry?
- CharlesW 4y agoI hadn’t heard it before, but it’s perfect and I’ll use it henceforth!
- seanmcdirmid 4y agoTeslas are just fun to drive, I don’t think most people buy them to signal virtue, if they want to do that there is always the much cheaper Prius instead. I don’t think most Tesla buyers also care much about Musk. The more likely answer is that Tesla went through a huge sales boom the last couple of years and that’s sort of done now, anyone who wanted a Tesla over that period has one now, and now people are watching their money more carefully.
- beoberha 4y agoI completely agree with you. In Southern California, you see people all across the political spectrum driving Teslas. As more options emerge, I don’t think it’s too crazy to see their market share go down.
- seanmcdirmid 4y agoYa. I bought a BMW i4 instead due to the better interior. Although I’m missing Tesla’s better software experience.
- thunky 4y agoWhen I see a Prius I think the driver probably has common sense and value's their money over their public image. When I see a Tesla I think the opposite.
- seanmcdirmid 4y agoAre you sure you aren't just imagining things about Tesla vs what is really true? When I see a Tesla, I think techie, likely Indian or Chinese, but thats just my own local profile of Tesla drivers in my region. When I see Prius, I think either ecological grandma or Uber driver. Again, just a sample from my local region, it might not hold for other parts of the country.
- thunky 4y agoYeah I'm sure I am being unfair to Tesla owners. I see them as "dumb techies". Probably getting a fat paycheck they don't really deserve, thinking they're smarter than everyone else and their choice of car proves it. I know it's wrong.
- HereBeBeasties 4y agoThat's quite a lot of projection. I bought a Model 3 because it felt objectively better / better value than everything else on the market at the time, having, you know, actually test driven pretty much everything. (Kia EV6, Hyundai Ioniq 5, Kia e-Niro, Jaguar I-PACE, Porsche Taycan even). Techies might (gross generalisation warning) tend to: a) Have higher than average disposable income b) Be early adopters of new tech c) Care less what other people think of them than an average person d) Judge things more objectively than an average person. So it's hardly surprising a lot of them end up buying a Tesla Model 3. They are very well-packaged, fast, have good range, the Supercharger network, and are fairly mid-priced as cars these days go (similar to say a slower BMW 3 series diesel, at least in the UK). The BMW i4 launched recently. The Tesla Model 3 is a six year old design. And yet the i4 has much worse range, is either slower or much more expensive, and according to all the critics seems to be less fun to drive. Heaven forfend that anyone buy a car on its merits, as opposed to what other people think of the badge.
- iancmceachern 4y agoIt was that way a couple years ago, now most progressives I know wouldn't be caught dead in a Tesla, exactly because of Musks right wing egomaniac behavior. You are a few years late with this comment
- malermeister 4y agoI think the Twitter purchase made it impossible to ignore his BS.
- Avshalom 4y agoProbably not, I hate Elon more than most people, but like https://en.wikipedia.org/wiki/Volkswagen_Passat#Sales https://en.wikipedia.org/wiki/Volkswagen_Passat#Sales (U.S. column) a lot of cars just see demand fall off a cliff when all they see is small refreshes over a decade. There's talk of Tesla being in the process of a full updates to various lines and until that (does|does not) happen it's probably a bit premature to chalk anything up to Tesla's cultural positioning (after all, unless (like me) you're a terminally online twitter user Musk's politics are probably completely unknown to you)
- deleted 4y ago[deleted]
- slaw 4y agoModel 3 is twice expensive as equivalent ICE car. I think market for small and expensive sedans is saturated. The same for model Y.
- princevegeta89 4y agoIsn't model Y also 1.5 times more expensive compared to its equivalent competitors like the Ford EV SUV and Id4?
- HereBeBeasties 4y agoI don't know about the US, but here in the UK an ID.4 GTX is £55k if you want a heat pump and not in flat primer grey. A Model Y long range which is faster (by 1.4s to 60mph) and has better range is £2k cheaper.
- electrondood 4y agoFalse, it's actually slightly cheaper than a new Camry. That's base price, and doesn't even account for significantly lower cost of ownership.
- greedo 4y agoPlease don't post easily refutable lies. Camry MSRP is $26,220 Model Y is $46,990 I would give you the benefit of the doubt that perhaps you're not using US prices and Camry's might be 76% more expensive where you live, but I doubt it.
- bsder 4y agoIs it just that competitors exist? At this point, the Model 3 is competing against the Chevy Bolt which is at least $10,000 cheaper. To buy a Tesla, you have to genuinely want a Tesla at this point rather than just an electric car.
- ivraatiems 4y agoThis is the actual reason. It has nothing, or almost nothing, to do with Elon Musk or politics. The average person, the average Californian, even the average EV buyer is not doing it to make a political statement. There are so many more options now than Teslas out there which provide quality and affordability. And there are used EVs on the market now that are viable, when there weren't before, including used Teslas. Yes, there are people (like me) who would never buy a Tesla because they don't trust the company or don't like Musk, but we're a severe minority. The reality is that Tesla is becoming less special simply because the rest of the industry is catching up - as Tesla should have known, and probably does know, that it would. The question is what they do about it.
- mint2 4y agoTesla as a brand is heavily associated with musk in a eta no other car company is associated with their owner/ceo. Musk is a reason I wouldn’t get a Tesla. There’s more than one reason but he is one of them.
- MBCook 4y agoThis is why they’re cutting prices. You’re dead on. They finally have real competition and they’re having trouble due to weaknesses (even if only perceived) like lack of CarPlay/Android Auto, quality issues, service issues, simple brand loyalty, and being heavily associated with someone many consider toxic. They’re losing their big advantage of being “the” electric car. People are now aware of other options. If Tesla was as unassailable as some fans claim, they wouldn’t need to cut prices. They could continue to charge the same amount and maintain market share, using the profits to improve things or produce more. The price cuts signal they’re in real competition. Good. That will improve everyone.
- 4y ago
- electrondood 4y agoMarket share is irrelevant. Tesla makes more in margin per car than their next 8 competitors combined. Recall that Apple took 35% of the profit in the smart phone market with only 7% market share. Also, Tesla's target market is not EVs. Their entire mission is to lose market share, by encouraging competition to transition to sustainable energy. Tesla's target market for their vehicle business is all vehicles.
- TheLoafOfBread 4y agoAre they? Since the last earnings margin went way down
- bagacrap 4y agoMargins are crumbling and now the story is that they'll make it back by selling fsd. On top of that, all the insane valuations assume both of the things (high market share of EVs and high penetration of EVs across car market). Anyway you already knew that.
- itsoktocry 4y agoMercedes just reported ~14% margins and rising, Tesla reported 19% and falling. Bit of a gap, but not 3x anything. And Tesla plays a little fast and loose with how they capitalize things. Oh, and they make huge margins off a product they sell that doesn't exist (fsd).
- mullingitover 4y agoAs the saying goes, "Concerning." It's almost as if Tesla is being managed by an executive who is distracted, only working the job part time, at a moment when competitors are deeply engaged and laser-focused. If a junior officer of the company were found to be moonlighting at several other jobs while drawing a full-time salary, they'd be fired on the spot.
- sidibe 4y agoMoonlighting while oaid is one thing, his stock grants until this year were about half of the TOP LINE revenue of the company. He has been paid so much more than anyone ever has (other richest in the world got it mostly through their initial shares' growth and their companies had much more revenue) for a part time job
- olliej 4y agoThis is fairly easily explained: Tesla actually has competition. People wanted electric cars for years, but no major manufacturers actually made any. Tesla demonstrated that you could make electric cars that were actually good. So people bought them, despite them being relatively premium vehicles, and for quite some time questionable construciton. So we finally get to today, the other big manufacturers have _finally_ got electric cars to market that don't have utterly pointless range (seriously until this last year or so your options were Tesla, or cars you could not commute in). Now Tesla is having to compete with cars that have nearly the same range, but are cheaper, come from companies with less polarizing CEOs, and who have not inextricably tied their brand image to said CEO. To me at this point the only thing that makes Tesla superior to the competition is that they don't have any of the BS with dealers.
- wilg 4y agoMarket share is a bit of a confusing metric here, because the electric car market is supply-constrained not demand-constrained. Tesla's selling every car they can produce. And also of course Tesla essentially has nowhere to go but down in market share because they were the only game in town for a long while.
- pengaru 4y ago> Market share is a bit of a confusing metric here, because the electric car market is supply-constrained not demand-constrained. Tesla's selling every car they can produce. That's just not true as of TSLA's most recent earnings, as reported by yahoo finance and discussed on HN in [0]: "Though Tesla has ramped up production and deliveries of its electric vehicles over the last several quarters, leading to near record levels of revenue, production has outpaced demand. The company said it delivered 422,875 units in the first quarter while producing 440,808." [1] [0] https://news.ycombinator.com/item?id=35643537 https://news.ycombinator.com/item?id=35643537 [1] https://finance.yahoo.com/tesla-stock-tumbles-over-9-to-near-3-month-lows-on-profit-concern-200842478.html https://finance.yahoo.com/tesla-stock-tumbles-over-9-to-near...
- wilg 4y agoIIRC the delivery numbers are usually a bit lower than production numbers on a quarterly basis for various unimportant logistics reasons, but over time both numbers are consistently increasing. They also beat delivery estimates in the same quarter you mention. https://techcrunch.com/2023/04/02/tesla-q1-deliveries-beat-expectations-as-china-helps-boost-sales/ https://techcrunch.com/2023/04/02/tesla-q1-deliveries-beat-e...