As everyone knows, the automobile industry has been slammed in 2020, including in the United States. Below is a look at third quarter auto sales across the country as well as auto sales in the first three quarters of the year.
Given that this is a cleantech site, and due to the stark contrast between Tesla sales and overall auto market sales, I will spend much of this piece comparing Tesla’s results with the broader market’s results and trying to explain them. There are other electric vehicles on the market as well, but few are widely available and most automakers do not break out their sales of electric vehicles separately from their gas model sales. Additionally, Tesla seems to account for about 75–80% of US electric vehicle sales.
Note that Tesla’s sales are not from official data. Tesla’s US delivery estimates are slightly modified from Troy Teslike’s estimates. However, I feel confident those are very close to reality.
The biggest takeaway is perhaps the one right there in the headline. Overall, the US auto market (not including a few minor brands whose data I could not find) saw its sales decrease 9% in the third quarter of 2020 compared to the third quarter of 2019. That’s much better than earlier in the year, at the height of the economic shutdowns, but it shows US car, truck, and SUV sales are still not rising out of the ditch of 2020. Across the first three quarters of the year, US auto sales were down 19%.
The US auto market would be down slightly more, 10% in the third quarter, if not for Tesla. Quickly jumping out of the corona ditch, Tesla saw its US sales (i.e., deliveries) rise by 22% in the third quarter of 2020 versus the third quarter of 2019, or 10,477 deliveries according to our estimates.
That said, there were some other brands with positive results last quarter as well, and one of them actually had slightly stronger growth than Tesla. Kia sales grew 24%, Acura and Alfa Romeo sales grew 17%, Volvo and Honda sales grew 11%, Chrysler sales grew 8%, Porsche sales grew 5%, and Lexus and Mitsubishi sales grew 2%. Though, those positive results were not nearly enough to offset these year-over-year declines in third quarter auto sales:
- Fiat — down 53%
- Nissan — down 33%
- Dodge — down 31%
- Infiniti — down 30%
- Genesis — down 24%
- Cadillac — down 18%
- Audi — down 16%
- BMW — down 16%
- Toyota — down 13%
- MINI — down 12%
- Chevrolet — down 11%
- Jeep — down 9%
- Subaru — down 9%
- Volkswagen — down 8%
- GMC — down 6%
- Ford — down 5%
- Mercedes — down 5%
- Buick — down 3%
- Ram — down 2%
- Hyundai — down 1%
- Lincoln — down 1%
No auto brand had positive results in the first three quarters of the year, but Tesla was the closest, down by only 2%, or 2,952 deliveries. The second best result was Volvo, down by 5%, or 3,828 deliveries. Most automakers were down by double digits in the first three quarters of the year.
Here’s a more detailed look at Q3 volume and percentage changes and Q1–Q3 volume and percentage changes by brand in both chart and table format:
It should be noted that Tesla is still presumed to be supply limited. As its production capacity rises, its global sales rise. Here are charts of Tesla’s global quarterly sales, which were new records for the company last quarter:
There are dozens of reasons why Tesla has done so well in 2020 despite the pandemic. Aside from specific vehicle benefits, two major matters come to mind.
First of all, the company is still quite young and most of the Teslas on the road have been sold in just the last couple of years. That means there has been relatively little time for non-fanatics to notice and experience Tesla vehicles on their streets. Many, if not most, Tesla sales come from someone poking around in and perhaps even test driving a family member’s, friend’s, coworker’s, or neighbor’s Tesla. Since many Tesla vehicles are so new, there’s only been a limited amount of time that people have had the opportunity for such experiences, and then, even if they love the car or SUV, they may have to wait a while before it’s time for them to buy a new vehicle again. For example, they may need to wait for a lease to end. Overall, though, many more people were exposed to Tesla vehicles by the beginning of 2020 than by the beginning or middle of 2019, and many people who experienced a Tesla for the first time in 2019 have had the time for initial interest to mature to the point of buying one.
Secondly, Tesla started producing and delivering the Model Y at the beginning of 2020. Being a relatively affordable SUV, which is the most popular vehicle class on the market these days, a large number of consumers were waiting for this model. Additionally, many off-the-street buyers or neighborhood buyers were probably more inspired to buy it than previous Tesla models.
Again, though, Tesla’s high sales come from dozens of different benefits. After Consumer Reports surveys identified that the Tesla Model 3 was the model that vehicle owners were most satisfied to be owning — across all age groups even — I came up with a list of 70 reasons why. Click either of those links to see my full list. The 7 biggest reasons for me are:
- top safety score of any vehicle ever tested by the NHTSA
- best semi-autonomous driving tech in the industry
- best infotainment system in the industry
- best performance in its class (whatever class you buy)
- beautiful design
- easy (and cheap) road tripping thanks to Tesla’s Supercharger network
- total cost of ownership is by far best in class.
Based on all of the evidence we have so far, consumers’ tremendous industry-leading love for their cars will lead to many more word-of-mouth sales of Tesla vehicles in coming quarters. Also, Tesla vehicles receive software updates every month of the year, and major ones seemingly about once a quarter. Those updates lead to a lot of excited social media posts — on YouTube, Twitter, Facebook, reddit, and beyond. They are their own advertising campaign. These consumer-based ads grow and affect people in ways similar to how long-term, consistent ad messaging from other auto brands slowly sinks in and influences consumer buying decisions. Tesla may not have a slogan like “Built Ford Tough” or “The Ultimate Driving Machine,” but the messages owners consistently push out there include: Teslas are the highest-tech cars on the planet, Teslas are a ton of fun and have the best infotainment system, Teslas constantly improve, Teslas are super safe, and Teslas have cutting-edge features that other automakers won’t have for years to come, if ever. In my opinion, CleanTechnica’s slogan is particularly fitting for Tesla: “The future is now.”
As a final comment, I think it’s important to reiterate that deliveries are not the same as demand. Tesla sells all of the vehicles it produces rather quickly. We don’t know how many vehicles Tesla could sell domestically or globally if it had twice as much production capacity. With a few factories under construction, I think we’ll see sales climb for years to come before there’s any possibility of identifying “steady-state demand” for Tesla’s overall lineup of vehicles. (Disclosure: I own shares of Tesla/TSLA, because I believe what I wrote above, among other things.)
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