Tesla has once again proved its dominant position in the global electric vehicle industry in the first half of this year. The Musk-led automaker reported sales of 889,015 EVs, ultimately beating the overall sales of its German rivals Volkswagen, BMW, Mercedes-Benz, and Porsche.
For context, below are the estimated sales of these four German brands in H1 2023:
- Volkswagen: 321,600
- BMW: 152,900
- Mercedes: 112.900
- Porsche: 167,354
Tesla continues to dominate while German brands struggle
Some people in the industry argue that the playing field for electric vehicle makers is unfair, considering how German industry players struggle to restructure their operations and factories for electrification. Moreover, German automakers also face intensified inflationary pressures, a lack of skilled EV workers, and increasing energy prices in numerous European markets.
As per Autoblog, German brands face software issues leading to launch delays and poor sales in their largest market, China. Notably, Tesla and local EV giant BYD currently dominates the world’s largest auto market. Likewise, Germans also struggle to gain significant market share, with Tesla being the most popular brand.
In contrast, Tesla advances as it continuously expands EV production across the globe by developing highly capable Gigafactories. It can also easily adjust its business to a more flexible production and revenue model than the German legacy brands that have lived for decades.
Tesla’s impact on the German brands will further aggravate as the American company employs a more aggressive pricing strategy.
“Tesla is still miles ahead of the German carmakers in all the major markets. They’re under pressure to boost volumes to reach the kind of economies of scale needed to make EVs profitable.”
Matthias Schmidt, Auto Analyst
Nonetheless, these legacy German automakers remain profitable with their internal combustion engine-powered vehicle models, particularly in the Chinese market. However, the wider adoption of EVs continues to progress, putting these brands’ business prospects at risk.
Therefore, they must start employing aggressive electrification strategies to catch up in the EV market.
See Also:
- Global plug-in electric vehicle sales topped 1 million in March 2023
- Tesla’s Germany sales grew 900% in January 2023 over last year
- Tesla assures buyers to cover reducing EV incentive in Germany amid massive sales drive
- Tesla Model Y receives Residual Value Award in European BEV SUV category
- Germany achieves significant milestone with over one million e-bikes produced in five months
Remarkably, these German automakers have no plans to give up despite losing ground in the past few quarters.
Volkswagen will soon launch a new EV with a base price of under €25,000. Mercedes will also bring an electric counterpart of the iconic CLA sedan to the US in 2024 to rival Tesla’s Model 3. Moreover, BMW will also introduce its “Neue Klasse” platform by 2025 to halve battery costs and improve driving range and charging speed by 30% compared to current BMW models.
“The next-generation EV platforms from the Germans could change things. That’s when you’ll see a big push from them, also in China.”
Bloomberg Intelligence analyst Michael Dean
