The electric vehicle market has been very promising in previous years. Now, the dozens of companies that grew up during the years of hot demand are competing in an ever-shrinking market.
And if the small players don’t have much chance of survival, some big players are likely to “fall” with a lot of noise. The once Magnificent 7, Tesla, (a member of the 7 tech companies that recorded an impressive performance in 2023) is not so magnificent anymore.
Losses in the value of its shares have exceeded 40% and the plunge in car prices to meet the reduced demand is continuous.
According to data from the New York Times, nearly 269,000 electric vehicles have been sold in the US in the first quarter of the year. That’s a 2.6% increase over the same period last year, but a 7.3% plunge over the last quarter of 2023.
Musk’s problem
The market is shrinking, but not all “players” have the same problem. For example BMW saw its first quarter sales soar and outpace its competitors.
In particular, deliveries of battery-powered models such as the i4, iX1 and i7 were up 41% in the three months to March compared to the same period last year.
But Elon Musk does not belong to the category of winners or even those who survive the reduced demand. In contrast, Tesla, once a pioneering entrepreneur’s company, is steadily losing ground to its competitors.
Tesla’s market share has fallen from 62% in early 2023 to 51% in 2024, according to data from vehicle appraisal and automotive research firm Kelley Blue.
Tesla remains dominant in the electric vehicle market, and Musk, despite the ups and downs in his fortune, is among the top four richest people in the world.
But the dynamics of his opponents has scared investors. For example, Ford’s electric vehicle market share increased to 7.4% from 4.2% last year, making it the second largest electric vehicle brand in the United States.
The difficult position
In that environment and with its stock in freefall, Tesla is expected to report a 40% drop in earnings on Tuesday, according to Bloomberg, as well as its first drop in revenue in four years.
Last week, it became known that it is laying off more than 10% of its staff worldwide as it adapts to this new reality.
The demand issue was particularly evident in one of Tesla’s most important growth markets, China. Musk has been engaged in a high-stakes price war in the country with local rivals such as BYD.
But the plunge in prices is not limited to Asia. Last weekend, Tesla also lowered its prices in Germany, while it has already lowered them in the United States.
“Tesla’s prices have to change frequently in order to match production with demand,” Musk justified in a post on X.
His loyal followers believe that the surprise-filled Musk can turn the game around. However, the course of its shares shows that its investors are more skeptical.
The postponement of Musk’s planned trip to India, where he would have met with Prime Minister Narendra Modi and announced Tesla’s entry into the South Asian market, only further strained his position.
The vision of the robotaxi
For some Musk has put a lot of issues on the table and so far he is unable to manage them. His vision of the robot taxi and the creation of a sub-$30,000 car were his latest commitments.
Despite reports that the “cheap” Tesla is on the “freeze” and that Elon Musk is focusing on robot taxis, aiming to pioneer autonomous driving, these are denied by him.
Musk insists that all of his plans stick to the timelines he’s set, but most people question them.
The concern is heightened as Tesla is not the only concept of Musk, who finds himself having to manage the challenges of X as well as his plans in artificial intelligence with Grok, a genetic artificial intelligence chatbot, which he developed.
Read also:
Tesla: Shareholders vote again on Elon Musk’s $56 billion compensation after court impasse
St. Moat: Elon Musk’s Demographic/Subfertility Statement Important – The Worrying Facts
Tesla: Layoffs hit China sales division
