No matter your political leaning, it is very difficult to ignore the impact Tesla has had on the automotive industry as a whole.
When the company recorded its first profits in 2020, it had not only managed to establish itself as a major player among automotive brands with over a hundred years in the business, it had done so with an all-electric offering; something those beholden to the oil industry had merely toyed with up until that point.
Not content with simply producing desirable, reliable and digitally class-leading EVs, Tesla also set about building the best charging network in the business.
Musk understood from an early stage that simple, convenient top-ups, free from payment pains, were key to the success of electric powertrains and only now are the big energy providers playing catch up to his Supercharger network.
Regardless, the brand has always been divisive, there have been numerous question marks over the build quality of its product, the production methods and the direct-to-consumer business model, but there is no denying the Tesla light shines at its very brightest when it innovates.
However, too much innovation can lead to distraction and Tesla’s current line-up of vehicles is getting long in the tooth. Customers are demanding fresh design, new technology and increased battery range, but these things are arriving drabs and drabs.
Meanwhile, Elon Musk is busying himself with a fierce determination to colonize Mars, replace the workforce with humanoid robots and, perhaps more damaging still, meddling in global politics, slashing US governmental jobs and generally causing upset on his social media platform, X.
This is all impacting sales and demand for Tesla’s aging line-up is waning. A shame, because the most recently updated vehicles, which include Model 3 and Model Y, are arguably the best cars Tesla has ever built.
An EV for everyone
Let’s park Cybertruck for a minute. Yes, it is packed with innovation (800V architecture for faster charging, steer-by-wire systems etc) but it’s not a volume player, it is only available in the US and Canada, and recent sales data suggests that customer demand is cooling. Oh, and apparently bits of trim keep falling off.
Model 3 and Model Y, on the other hand, are the company’s bread and butter.
A recent update to Model 3, for example, introduced a completely new exterior aesthetic. Gone is the slightly frumpy and awkward shape, as we welcome in sleek lines, razor sharp LED headlights and a neat full width light bar at the rear.
The Model 3 is now more aerodynamically efficient than its predecessor and the interior, although still typically Tesla levels of sparse, is finished with aluminum, sumptuous leather-effect seats (cooled and heated), as well as 15.4-inch centre display up front and an 8-inch rear display to keep passengers entertained. It’s a lovely place to while away the hours.
Mercedes-Benz will wax lyrical about its upcoming CLA’s ability to act as a cinema and games console, but Tesla has been doing this stuff for years.
Mapping fart noises to seats and offering jazzy exterior light displays might sound like the stuff of adolescent dreams, but kids absolutely love it and rival manufacturers, such as Rivian, are now copying the blueprint wholesale.
Perhaps more importantly, Tesla has increased the overall comfort and refinement in its recent upgrades. There’s 360-degree acoustic glass, improved suspension bushings, thicker seals and a hefty dose of additional sound deadening materials.
Finally, it now feels like a Model 3 will be able to rack up the miles without feeling dogged after a few years of ownership. It stands up to the competition, too, while the general ease of use makes it the EV for most people.
Plus, the introduction of Ultra Wideband (UWB) technology means using your phone as a key actually works and Tesla’s smartphone app is second to none, able to locate a parked car, check on charge status and seamlessly integrates with Powerwall and other Tesla energy solutions.
Sure, Model 3 still isn’t the most-engaging vehicle to drive and it lacks character. But it’s effortless, it’s easy, it’s bright, roomy and airy. It's also efficient and dead easy to charge thanks to the robust Supercharger network. This is what the majority of buyers want.
Many of the same updates are now arriving on Model Y, which is not only Tesla’s best-selling model, it was also the best-selling car in the world last year, period.
From zero to conquering the global sales charts in a mere 17 years is nothing short of miraculous. So why isn’t Tesla continuing to build on its successes?
A stale Musk
In short, Elon Musk happened. The once eccentric tech entrepreneur, the IRL Tony Stark, has developed an altogether more divisive persona.
“We struggle to think of anything analogous in the history of the automotive industry, in which a brand has lost so much value so quickly,” wrote JP Morgan analysts in a report quoted by Quartz that has charted Tesla’s recent sales slump.
Since taking up his role in The White House, Tesla’s share price has dropped by nearly 50% from its peak in December, with any gains the company made by Musk’s political ventures (affectionately known as the Trump Bump) effectively wiped out.
Tesla’s sales figures make for depressing reading, with numbers nosediving in Europe, California, Australia and China - all of which were considered key markets for the brand, where the recently updated Model Y was expected to, once again, storm the sales charts.
While it’s easy to suggest that Musk’s questionable antics, both in public and on his social media platform, are the root cause of all of these issues, that’s not the case. The fact of the matter is, competition in the EV space is now the fiercest it has ever been.
China is the perfect example of this. Where Tesla was once considered the epitome of EV technology, it is now lagging behind rivals, such as BYD, Xiaomi, XPeng and more.
Speaking to The New York Times, one Chinese electric vehicle dealer suggested that Tesla’s competitiveness in China will only last for “the next two or three years at most”, stating that rivals offer a greater amount of cutting-edge technology.
With no hint of a revised Model S and Model X, scant detail on the new Tesla Roadster we have long-been promised and poor uptake of its Semi electric truck, it appears that Elon Musk’s mind isn’t particularly set on turning around the fate of his once pioneering electric vehicle brand.
Last year, Musk told investors and journalists that Tesla is “an AI, robotics company”, with its astronomical market valuation now seemingly linked to a Robotaxi business and advances promised in humanoid robotics that could, one day, replace the workforce.
The sad truth is, this is what gets the markets excited and makes Tesla one of the most valuable companies on the planet. But following a traditional automotive development cycle, building hype with concept cars, refreshing models every two or three years and generally behaving like an established automaker isn’t.
However, this laser focus on other areas of the business, as well as a career in politics, has Tesla’s car business in a bind.
This week, the company has been the subject of yet more arson attacks and acts of graffiti and violence against dealers. What's more a recent report from Inside EVs claimed that insurance costs could surge for Tesla owners, due to this wave of vandalism.
A website has also surfaced that contains the address and contact information of thousands of Tesla owners and DOGE employees, with the callous doxxing act requiring said owners to prove they have sold their cars to guarantee removal from the list.
Even if Tesla’s automotive business somehow distances itself from Musk, it feels like the damage has already been done.
The Tesla reputation is tarnished and there are plenty of rival brands keen to offer an alternative.
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