With all this talk about Tesla going private, hitting record VIN registrations for the Model 3 and the Chinese Gigafactory 3 going full steam ahead, not many people are talking about worthy opponents to the Model 3.

First, let’s see what they’d be up against. The Model 3 is now one of the Top 10 best-selling cars in the United States. That’s not within the EV segment and not even within the entry-level luxury segment where it’s operated until now. That’s their overall ranking in the passenger car segment in the U.S. as of July 2018. And that ranking is only going to get higher as Tesla ramps up production.

Tesla (Model 3) competition nowhere in sight

As a matter of fact, there are only 10 models from different companies that sold more than 10,000 units in the month of July this year. No other EV made it to the Top 10. As a matter of fact, the entire Toyota Prius family, of which the Prius Prime is a part, sold a little more than half of what the Model 3 alone did in July.

Considering this gap, the only way to predict the future EV stars of America is to first look at the top-selling plugins, and then look at emerging companies that have products in a comparable price range. That boils it down to the Prius Prime, Chevy’s Volt and Bolt EV, the Honda Clarity PHEV and the Nissan Leaf. But the problem is that their collective sales for July stand at 7,223 units or, once again, a little more than half of Model 3’s sales.

So is there really a worthy opponent out there for the Model 3 even when the price stays north of $50,000? No, there isn’t. We can speculate all we like about which of the existing models can match Model 3 sales over the next few years, but it’s clear that there’s no other contender in the U.S. EV market. In fact, even within that space, three of the top 5 models belong to Tesla.

But the thing is, the U.S. is not the heaviest market for EVs. That would be China, so it makes sense for us to zip over to the other side of the globe and see what things are like in the market that consumed 49% of the world’s plugin vehicles produced in 2017.

Overall NEV (new energy vehicles, as China calls them) sales topped 600,000 units for 2017. Not accounting for seasonal variation, that’s about 50,000 cars a month. The estimate for 2018 is 50% higher, or about 75,000 cars a month. More than 90% of that is produced locally by OEMs like BAIC and Geely, among others. Tesla is the largest ‘non-Chinese brand’ in that market. In terms of volume, Tesla can’t match Chinese companies selling locally.

Or can they?

With production at the planned Gigafactory 3 in Shanghai slated to begin in 2020, we could see Tesla putting out at least 250,000 cars per annum within two years of that timeline. The eventual capacity of the plant is 500,000 cars a year, which is more than 40,000 cars a month. In a market that’s expected to reach 75,000 cars a month or more this very year, it’s not a stretch to assume that those 40,000 cars will be absorbed by the market when 2022 rolls around.

What gives that assumption a high probability is the fact that a Gigafactory in China will allow Tesla to produce more for less. China has shown enough interest in this deal for us to presume that Tesla will get adequate subsidy backing if the cars it sells in China are made locally. And if a Chinese entity like Tencent were to help Tesla go private at this crucial time of trade conflict, it would be a win-win situation for everyone but Trump’s America.

So the only recourse we have is to assume that there really isn’t any other player to take on Tesla on a global scale at the moment. The majors all have years to go before they introduce their full electric fleets, and none of them will ever capture the collective consumer imagination like Tesla did. This article might be very different if we were in 2023, but for now, Tesla is the clear monarch of the battery-powered auto world, with no heir-apparent on the horizon for at least another half decade.

3 COMMENTS

  1. Whoever write this article is woefully ignorant about the curent state of EV development and should never be allowed to pen articles on this subject. The idea that there will be no competition for the Tesla Model 3 for at least 5 years just may e the dumbest statement i’ve heard in a long , long while.
    Let’s start out by pointing out that over 120 electric models will be coming to dealer’s showrooms over the next several years – few of these will even be three years away. The Volco Polestar 2 is
    outrageously superior to the Model 3 and its will arrive within 18 months, if not sooner. And it actually will have a $35,000 version , with a drivin range greater than the Long Range version of the Model 3 ($55,000)The Model 3 cannot compete against the Polestar, period. Either in terms of price,technology or looks. By my estimate , considering the state of subsidies at the time, it will cost between $17,00 and $22,000 less than the Model 3.Only a fool would buy the Model 3 under those (or any other) conditions. Considering the high end of the Model 3 versions we find the imminent appearance of the Porsche Taycan. Not only can it recharge its batteries twice as fast as Tesla’s Supercharger can, it can operate at maximum output indefinitely, which none of the Tesla cars can do. It will also outhandle and outrun the high end performance Model 3 and it styling is years ahead of the nondescript lines of the aging Model 3 design. It will also steal many sales from the Model S and Model X. The Buick Enspire is another EV that will appear right around the corner and it will do well against the Model 3 , Model Y line. Almost every one of those 120 upcoming electric cars will have, in the U.S. a $7500 price advantage due to tax credits over any Tesla vehicle. And they will be technologically more advanced as well with respect to driving ranges, speed of battery recharge,etc. Tesla is a company that likely will not even be in the auto business within five years. They simply cannot compete against the pros.

    • Are you an intelligent bot, Kent? Because I kind of notice all your responses have a mechanical theme to it. Just wondering and you never respond to any questions posed to you, but always have questions for each article. MMM

      Anyways just answer one simple question and we will call it a day. Name one single company that can build 300k batteries (for cars) in a year?

      If you can’t answer that, then how much does it cost to build a factory with that capacity – and how much time will take?

      People who don’t have answers to these questions can, of course, be allowed to comment.

      Here’s our response to to you:

      https://1reddrop.com/2018/08/10/volvos-polestar-2-is-not-going-to-rival-teslas-model-3-in-the-next-5-years/

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