Tesla’s Market Share Dips Below 50% for the First Time

Tesla’s share of the U.S. electric vehicle (EV) market fell below 50% for the first time in the second quarter, dropping to 49.7% from 59.3% a year ago, according to Cox Automotive. Despite this, sales of battery-powered cars have reached a record high. Overall, U.S. EV sales rose by 11.3% year-over-year, with over 330,000 electric vehicles sold or leased in the quarter, representing 8% of all new vehicle sales, up from 7.2% the previous year.

This shift indicates that Tesla is losing its dominance in the EV market, which it significantly influenced with the launch of the Model S in 2012.

Tesla’s decline in market share was attributed to different factors. First, there has been an increase in competition from other automotive manufacturers, such as General Motors, Ford, Hyundai, BMW, and Kia. Per a report from the Alliance for Automotive Innovation, there are more than 100 different models of electric cars available in the U.S. market for consumers to choose from. This monumental increase of competitors for Tesla ballooned from basically none, and now many other vehicles can rival the specs and performance metrics of Tesla vehicles.

Additionally, these established brands have an advantage with their large network of dealers that can provide support for customers. In contrast, consumers who’ve purchased a Tesla vehicle, especially through the company’s online website, have made it known how they’ve had difficulty when attempting to have their Tesla cars serviced by an official Tesla dealer.

Elon Musk’s persona in the public sphere recently might have also been detrimental to his public perception and could be negatively affecting sales of his brand.

From the stock market side of things, Tesla has been on a streak with a small yet steady rise in share prices that have equalized previous lows and losses earlier this year. But tough times are ahead due to the ongoing and evolving market situation, with the rise of Chinese electric vehicles being produced and made available across the globe.