Elon Musk’s Tesla could lose its position as the world’s number one battery electric vehicle (BEV) seller to German giant Volkswagen by 2024, according to a study by Bloomberg Intelligence, titled “Battery Electric Vehicles Report – Automakers Race to the Top”.
According to the analysis, most competitors, including Ford and General Motors, had no incentive to catch up as quickly as Volkswagen due to rising battery costs and tight production capacity. As a result, Tesla will likely be the largest supplier of electric vehicles in the United States for some time.
Meanwhile, reports have surfaced that this year in the first quarter, despite growing competition, Tesla’s Model Y SUV and Model 3 sedan were the two best-selling vehicles in the United States.
Volkswagen’s production and sales are concentrated in Europe, and the study predicted that business will grow more in China than in the United States.
According to VW’s annual report, US sales accounted for less than 10% of total sales last year.
It has also been said that Tesla’s sales in China, where it now produces two models, are likely to suffer.
According to Kelly Blue Book, Tesla was an early adopter of the electric vehicle revolution, accounting for 75% of all electric vehicles sold in the United States in the first quarter of 2022. However, according to experts, competitors are gradually eroding a part of this market share. taking advantage of their size.
Michael Dean, senior European auto industry analyst at Bloomberg Intelligence, said: “Looking ahead, automakers in Europe, China and elsewhere will continue to challenge Tesla with an impending wave of new models, although that incentives for profitability are limited due to rising battery costs and a lack of scale.
“That could change in 2025-26 as more brands reach critical mass on next-gen models with proprietary software. There are a number of difficult external factors to factor in and BEV’s bold ambitions have done little to prevent crisis-level valuation multiples fueled by recession fears, rising interest rates, supply chain constraints and inflation,” he added.
The cost competitiveness of BEVs still depends on the price of batteries, and Volkswagen is investing up to 30 billion euros in the supply chain, including the construction of six new battery cell facilities in Europe by 2030.
Northvolt, a Swedish battery maker, will start producing high-end cells for it in 2023, while Audi’s Q4 BEV midsize SUV already has a similar margin to its internal combustion engine equivalent, the Q3.
Steve Man, senior China auto industry analyst at Bloomberg Intelligence, said: “China’s carrot-and-stick approach to fueling electric vehicle sales could push battery electrics to account for 25% of all purchases of passenger vehicles by 2025. Sales in China have since surged. the launch of the country’s new energy vehicle credit program despite an erratic supply of components.
However, according to the analysis, after ceding first-mover advantage to Tesla and local producers, sales of Volkswagen, BMW and other Western brands in China could come at the expense of price and profitability.
Local brands like BYD, Nio, Xpeng and other Chinese automakers are rapidly closing technology and brand gaps, enticing customers not only with increased range and power, but also with lower costs, trims luxury and even virtual reality entertainment.
Of note, Ford has taken the lead with the F-150 Lightning, which has attracted 200,000 orders, while GM is working on its next-generation “Ultium” batteries. Volkswagen is also considering Porsche, its sports vehicle division, which also offers an electric model.
Meanwhile, it has also been said that Japanese automakers are developing comprehensive electrified vehicle plans to meet the needs of various markets.
According to experts, the sector is poised to boost electrification initiatives, using hybrid expertise to compete, especially in battery electric vehicles, which now dominate their home market.
Tesla, on the other hand, has increased production and taken advantage of the economies of scale that exist among early adopters. It began delivering automobiles from its gigafactory in Berlin in March, with a goal of producing 500,000 cars a year.
But Volkswagen CEO Herbert Diess told the media at the World Economic Forum in Davos, Switzerland, that after the company fixes its global supply chain issues, it will overtake Tesla as the biggest. electric vehicle manufacturer in the world within the next 3 years.
Read all the latest news, breaking news, watch the best videos and live TV here.
#Tesla #cede #top #battery #electric #vehicle #sales #Volkswagen