General

Tesla Model Y is #1 best-selling car in China, #1 best-selling EV in Europe – why?

Tesla Model Y is #1 best-selling car in China, #1 best-selling EV in Europe - why?

The Tesla Model Y is undoubtedly in high demand. It’s similar in many ways to the Model 3, but a bit taller and falls into that much-loved “crossover” category that adds a little bump in the trunk and a higher seating position (with easier boarding and alighting for people).

You might think there’s only so much demand for two similarly designed models from new US automaker Tesla, and the Model 3 and Model Y should split the pie, especially overseas in Europe and China. As it turns out, both models are in so much demand that the Model 3 has continued to sell well as the Model Y climbed to the top of the charts in the European EV market and in the general Chinese car market. Admittedly, the No. 1 position in China was only for the month of June, and the Model Y was only 3rd in the EV market in China in the first half of the year. However, the model holds the #1 position in the European EV market for the entire first half of the year, and the Model 3 holds the #2 position.

What makes the Model Y (and Model 3) so appealing, with so many other electric vehicles, including electric crossovers, now on the market? Why is the Model Y on track for perhaps 300,000+ sales in China this year and 100,000+ in Europe?

The Model Y certainly performs well in safety tests, offers ample cargo space and passenger seating, and looks good. In addition, the vehicle has good range for the price, great infotainment and world-renowned acceleration. Each of these benefits can be critical buying factors for many buyers. However, everything mentioned so far can easily be placed in the category of “ticks” – basic requirements for many buyers, but not decisive factors. What really sets the Model Y apart from the rest and makes it such a high number of sales, in my opinion, are a few other things.

#1 — Supercharge

Year after year, several years back, our surveys of EV drivers showed that a very large proportion of drivers expected their next EV to have access to the Tesla Supercharger network or a comparable super-fast charging network. There is still no competition with Tesla in this area and buyers know that. I’ve talked to plenty of Tesla owners who have said they’d buy another EV if it weren’t for the gap in long-distance charging capability. Tesla Superchargers offer much better connectivity in many regions, offer excellent reliability that I believe is still unrivaled in the industry, and offer an extremely convenient way of charging – just plug in (and make sure you have a payment method set up) in your Tesla app).

Interestingly, Tesla is starting to open up its Superchargers to other brands in parts of Europe (and the United States). It will be exciting to study the effects of this on consumers of different types and brands.

#2 — Tesla’s Technology Leadership Overall

“Tech” was covered in several ways above, but my point here is that the Tesla brand is now highly acclaimed worldwide as a technology leader – not just in the auto market, but in general. Buying a Tesla vehicle means buying cool, cutting-edge technology – and you know it’s going to keep getting better with over-the-air software updates too! Whether it’s really all the specific technical features of a Tesla that a person sells on Tesla, or just the look that comes from buying a “tech leader Teslaproduct, I believe this Silicon Valley DNA is a big reason why so many people want a Tesla. Just anecdotally, I know people who don’t really care about anything else in this article but own a Tesla Model X because it’s a cool piece of technology to have.

#3 — Tesla’s role in the EV revolution

This next point is similar, but a little deeper and wider. It seems that in every conversation that comes up about electric vehicles, Tesla is there. Everyone knows Tesla and has at least a few concepts in mind about Tesla. Even people who don’t realize that Tesla only sells 100% electric vehicles have a few thoughts about Tesla! But one of the fundamental things I think most people know about Tesla is that it sells cars that are all-electric. Undoubtedly, electric vehicles are increasingly attracting people’s attention as commercial after commercial is about a car manufacturer’s new electric car. Super Bowl car commercials have been dominated by electric vehicle ads for a few years now. In that regard, we all know that Tesla does not advertise, but during Superbowl weekend/week it does get a significant increase in interest on Google. Because everyone knows that Tesla is the leader in the EV industry. Tesla is the benchmark.

When it comes time to buy, some buyers go with a new Volkswagen ID.4 (my sister is in that group), a cool Ford Mustang Mach-E (I see more and more in my area), a Kia EV6 or Hyundai IONIQ 5 (these look like) so futuristic and cool and I love that I already see them regularly here in Florida), but a large part of the buying public wants an electric car from the electric car industry leader. Especially if they subscribe to the concept of an ‘EV revolution’, they want something from a revolutionary top general, not a vehicle of the old guard. It’s basic logic.

Of course all this talk about the Super Bowl and the electric cars that I see popping up around me is relevant here where I live and not in Europe or China, but it’s basically the same story in those places. While many buyers will indeed choose a non-Tesla EV, a large proportion of them want a revolutionary tesla.

#4 — PRODUCTION CAPACITY (Batteries!)

Yes, you still have a long waiting list to sit on when you buy a Tesla, but look for a carmaker with a larger EV production capacity. There’s no denying that you can’t sell what you can’t produce, and it’s Tesla’s higher production capacity (and battery power) that will allow Tesla to sell as many EVs each quarter in Europe and China, as well as in the United States and elsewhere. Higher production capacity also lowers a portion of the company’s unit costs, helping to make Tesla vehicles more competitive and helping Tesla capture more profit margin… which can then be invested in innovation, better charging infrastructure, more features and growth .

There are several production limiters, including wire harnesses built in Ukraine and now infamous car chips, but the biggest production capacity limitation in the EV industry is batteries. Tesla has done a better job of protecting batteries in the long run, and anyone who wants to take down the reigning global giant and remain a champion for a long time will have to do the same.

Those are my thoughts on why the Tesla Model Y is being sold so much – be it in Europe, China or the US. Do you own one?


 

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