The only constant thing in life is change. For many years, Tesla has dominated the electric vehicle market in the United States and other parts of the globe. However, that dominance is now threatened by the growing number of more affordable alternatives as reported by S&P Global Mobility on Tuesday 29 November 2022.
On close analysis, the data firm discovered that Tesla’s market share dropped from 71% in the third quarter of 2021 to 65% in the same time of 2022 when new registered EVs in the United States were analyzed. In 2020, that figure was 79% within the same period.
S&P forecast for Tesla’s EV market share is even more gloomy. The data firm predicts that Tesla’s market share will plunge further to below 20% by 2025. Within the same period, the number of EV models is projected to balloon from today’s 48 count to about 159.
Although Tesla’s U.S. market share was expected to decline progressively, the rate of plunge within a short space of time should make investors of the auto company raise an eyebrow. With Elon Musk’s attention shifted to fixing his newly acquired social media platform, Twitter, Tesla’s shares have been on a free fall in recent weeks.
The S&P report clearly states that Tesla’s loss has been majorly at the entry level where competitors’ prices have been below $50,000. According to the same report, “Tesla does not really compete” at the entry-level. For example, the starting price of the entry-level Model 3 is around $48,200, including the shipping fee. However, the retail price is higher with options.
“Tesla’s dominance is changing with the emergence of new, more affordable options, offering the same or even better technology and production build,” the S&P report said. “The growing consumer interest and choice in EVs means Tesla will struggle to retain market supremacy going forward.”
Through the third quarter of 2021, about 10.22 million vehicles were registered in the United States. Out of this figure, about 525,000 or 5.1% were all-electric models. This was a 2.3% jump compared to 334,000 or 2.8% in the previous year.
Tesla is pushing for a universal electric vehicle charge connector
On 11 November 2022, Tesla announced that it was “opening up its EV connector design to the world”. With that announcement, non-Tesla automakers and drivers were invited to use Tesla’s EV charger.
Tesla rated their charge connector over the Combined Charging System (CCS) connectors saying the Tesla connector had no moving parts, was 50% smaller, and double the power of the CCS. With that comparison, Tesla set Nov. 29 for the establishment of a North American charging standard.
Responding to that post, Charging Interface Initiative (CharIN) Inc., a global group that advocates for a standard electric vehicle charging connector, said “CCS has undergone years of rigorous standardization, which is a necessary process for a new standard proposal. After 10 years of joint work, the domestic and international electric vehicle industry has sided with CCS.”
CharIN Inc. has pushed back on the Nov. 29 date set by Tesla saying the Tesla connector doesn’t take into account the commonly recognized equipment used by most EV manufacturers.
The adoption of Tesla’s charge connector would have Tesla maintain dominance in the EV industry since other manufacturers would have to adopt the Tesla charge connector. Also, this would have drawn major traffic to Tesla’s charging stations.
Tesla updates mobile app
Tesla has released an update to its mobile app that adds some innovative features for more seamless use. In the past, Tesla would send a notification telling drivers that there was a new update. However, the driver would have to get to their car to start downloading the update for onward installation.
Later, Tesla made it possible for users to start the update from the app. Nevertheless, the user would still have to enter the car to see the content of the update. With the new version 5.15.0 of the Tesla mobile app—which is now available on the App Store—Tesla drivers can now view release notes from the app without having to enter their car.
This feature is only available to Tesla EVs with the 2022.40+ vehicle software and newer. The feature appears to be the only addition to the new mobile app released on 29 Nov. 2022. There are also speculations that Tesla may add features that will allow the driver to get live feeds from the Autopilot camera feed straight to their mobile app.
A redesigned Tesla Model 3 is on the way
The bulk of auto manufacturers places their cars on year-to-year updates that often see a modification in mechanical parts. Tesla approaches updates differently by relying wholly on over-the-air (OTA) updates while changing mechanical parts at the point of production. As a result of this, the Tesla Model 3 which is nearly 6 years old has never received a facelift—but that is about to change.
Tesla announced that a refined Model 3 with the moniker ‘Highland’ is expected to go into production as early as the third quarter of 2023. This is an attempt for the company to simplify its design and push down the production cost. Perhaps, Tesla is ready to compete in the EV entry-level market.
The redesigned Model 3 will eliminate most of the complex interior features and retain only the features that users care about like the center display. The last time Tesla made a major upgrade to its EV was the replacement of the steering wheel of the Model S with a yoke setup as well as changing its screen orientation to horizontal—a feature that was already present in the Model 3.
Considering Tesla’s track record of not keeping to release dates, it will not be a surprise to see the pushback of the date for the release of the redesigned Model 3. One thing is certain, Tesla is struggling to maintain its hold as an EV leader in the U.S. and some other countries.