Backed by strong sales performance of Model 3, Tesla has raced to the top of the plugin-in electric vehicle sales chart in Canada, while managing to get things back on track in Norway – it’s third largest market.
Tesla sold 1,300 Model 3s in Canada in September this year making the cheapest Sedan from Tesla stable the number one selling EV in the country by a wide margin. The second-placed Nissan Leaf managed just 605 units for the month.
In Norway, one of the most critical markets for Tesla outside the United States, the company sold 2016 Model S and Model X, slightly better than the 2003 units the company sold last year.
Why is this important?
Tesla is facing severe headwinds in China, its second largest market, due to the ongoing trade war. According to our estimates, Tesla sold nearly 16,500 Model S and X in China last year. A significant portion of that sales number will vanish this year as “Tesla is now operating at a 55% to 60% cost disadvantage compared to the exact same car locally produced in China.”
Tesla has to find space in other markets to compensate for its sales weakness in China. The electric car maker expects to sell 100,000 Model S and X this year which is nearly the same number of units the company sold last year.
Though the flat growth projection does reduce Tesla’s headache, the company still has to find an offset to balance its trade war-induced weakness in China. If Tesla manages to sustain its strong performance in Canada, Norway, and the Netherlands in the fourth quarter, it will help the company reach its 2018 targets without breaking a sweat.
Canada: Tesla has sold 2,012 Model S and Model X in the first three quarters of 2018, compared to 2,502 units the company sold in the same period last year. Tesla has sold 4,295 Model 3 in the country so far this year.
Norway: The Nordic nation briefly lost its third largest market for Tesla tag to the Netherlands in July and August. Tesla sold 838 Model S and X in the Netherlands, way higher than the 295 units the company sold in Norway.
The slowdown in sales along with Tesla’s well-documented service capacity issues in Norway, raising some serious questions about Tesla’s ability to reach its 2018 sales target of 100k Model S and Model X units. But Tesla managed to pull things back on track in September.
Even if Tesla manages to repeat its last year’s fourth quarter performance, the company will still end up reporting growth in Norway this year, as the company has now sold 6,321 units (in the first three-quarters of 2018) compared to 4,719 units the company sold during the same period last year.
In July this year, Needham & Co. analyst Rajvindra Gill downgraded Tesla stock citing lackluster Model S and X sales as one of the reasons why he remained bearish.
How did Tesla perform this year compared to last year? The S and X Comparo
In the first three quarters of 2017, Tesla sold 72,290 Model S and X worldwide. This year the company has sold 71,760 units. A difference of just 530 units. But Tesla sold 101,250 Model S and X last year and expects to sell only 100k units this year.
Conclusion: Lackluster sales or not, Tesla is well on its way to delivery on its Model S and X sales guidance for the year.