Tesla Model 3 = Lightning, Model Y = Thunder

Maybe this isn’t the right metaphor. Lightning and thunder are essentially the same things — just the light and sound manifestations of a certain phenomenon.

Nonetheless, in a sense, I guess you could say that the Model 3 and Model Y will be different forms of the same thing as well, right? Different vehicle forms using the same powertrain — or a very similar powertrain.

In any case, the main reason I’m comparing the Model 3 to lightning and the Model Y to thunder is because I wanted to feature the song below in an article. So just hit play and then read on for the real fun.

As we’ve seen, the Model 3 is crushing the competition in the luxury car market in the US. In fact, it is performing so well that it is apparently pulling sales away from much cheaper and hugely popular models like the Honda Accord, Honda Civic, Toyota Prius, and Toyota Camry.

This is hurting the sales of certain automakers a great deal, but the market may not hear the impact until the thunder booms.

Before I get to the thunder, though, let’s look at a few sales figures.

BMW 3+4 Series Sales

Mercedes C-Class Sales

Clearly, sales of premium-class sedans from BMW and Mercedes-Benz are down in the United States.

Clearly, sales of the Tesla Model 3 premium-class sedan are through the roof.

However, those aren’t the only related trends. In addition to the Model 3’s rise, small/midsize SUV or CUV sales from BMW and Mercedes-Benz have been strongly up. Take a look at four more charts below, sales of the BMW X3 and Mercedes-Benz GLC-Class.

This can get confusing. We have three trends in these important premium-vehicle classes: Relatively affordable premium sedans from BMW and Mercedes-Benz are way down. Relatively affordable premium sedans from Tesla are way up. Relatively affordable SUVs/CUVs from BMW and Mercedes-Benz are also up.

You can’t ignore that the Model 3 is taking sales away from BMW and Mercedes, even though these companies’ SUVs/CUVs are surely doing so as well. Many of the cars being traded in for tens of thousands of Model 3s are 3/4 Series and C-Class cars from BMW and Mercedes — those buyers left BMW and Mercedes for Tesla.

Rising sales of premium-class crossovers may have BMW and Mercedes feeling comfortable enough. They may even make executives from these companies think that it’s okay to pretend the Model 3 isn’t hurting them — at least, not much. “After all, we’re selling a lot of SUVs and crossovers.”

But imagine it like this — the Model 3 was the lightning, while the Model Y is going to be the thunder.

The Model 3 was a clear visual sign that danger is striking nearby. The Model Y will deliver the roaring thunder that visibly shakes these automotive giants.

If BMW X3 sales and Mercedes GLC sales are disrupted at all by the Model Y (and how can they not be?), there will be no other class for these automakers to fall back on. Sales forecasts could suffer. Balance sheets could suffer. Resale values on these models could suffer, leading to even more problems for BMW and Mercedes.

This process will again originate in the United States, but Tesla is also building a Gigafactory in China, where BMW and Mercedes have been putting a lot of their eggs. A European Gigafactory is also supposed to be around the corner, perhaps placed in the homeland of BMW and Mercedes — Germany.

The Tesla Model S is already beating its German competitors in Europe — not in Germany (not even close), but in Europe.

Can BMW and Mercedes recover with the iX3 and EQC electric crossovers? They are looking to be some of the better electric vehicles planned for release in the coming years, but many of us are still skeptical that they can compete with a Tesla in various important ways — range per dollar/euro, superfast charging, software, performance. Will they really be able to retain their customer base with these? Or will the vehicles be a case of too little, too late? Will these automakers even have the battery supply if there is strong demand for these vehicles?

It’s hard to say at this point where Mercedes and BMW will land with these offerings. But it is very easy to say that Tesla will have enormous demand for the Model Y, and that will be coming at some other companies’ expense — thunderous expense.

I love a strong Florida thunderstorm. The lightning is beautiful and the thunder is powerful and exhilarating. Since moving back here a few months ago, I’ve been enjoying the view of a lot of lightning and a lot of Model 3s. The roaring thunder is here too. The Model Y, not yet. Give it a little time, and brace yourself.