What Tesla Needs to Dominate the Market (Part 1)
Many of us here at CleanTechnica have friends and family members who are looking to purchase an electric car, and that discussion has gotten more varied and interesting in the past year. An interesting bit of information came out in our “Tesla News” chat when Benni Schulz wrote, “most people I know are now buying an EV, and none of them is buying a Tesla.” With one exception (my friend, Matt, who is waiting on a Tesla Model Y), I’m in the same boat as Benni. With massive sales, irrepressible hype, and the nation’s best high-speed charging network, you might think that Tesla would be at the very top of everyone’s EV shopping list. So, what gives?
Editor’s note: Despite the above anecdote, and notwithstanding the arguments and ideas below, Tesla sells as many vehicles as it builds and actually has a long waitlist because there’s so much more demand than production capacity. Despite its rapid production growth, that can seemingly never keep up with growing consumer demand for the Model 3 and Model Y. And that production–demand mismatch mostly comes down to battery availability. Nonetheless, to become a truly dominant automaker in terms of market share down the road, the ideas below are probably good ones. —Zach Shahan
Is Elon the Problem?
Look, Elon Musk is a polarizing figure, who many would love to see take a step back from his role at Tesla — there’s no doubt about that. Are the Tesla Technoking’s well-publicized antics and sketchy interpersonal behavior really driving people to overlook the brand?
That doesn’t seem to be the case for mainstream buyers (read: “non-car people”) who don’t follow Musk as eagerly as we might think. Most of those people don’t mind Elon. Instead, “they mind the existing options,” as Benni said. “(They find them) boring.”
Taking a step back and looking at the Tesla lineup as a collection of cars, and not a collection of electric cars, I have to agree.
Same Sausage, Different Lengths
For many years — a few decades, in fact — BMW was accused of selling “the same sausage in different lengths.” This was superficially true, as the E36 3 Series of the early 1990s looked an awful lot like the 5 Series, which (in turn) looked an awful lot like the 7 Series (shown above). Under the skin, too, many of these cars could be had with different versions of the same inline-6 engine, with similar suspension tuning and RWD driving dynamics baked in to give them all that “Ultimate Driving Machine” feel.
BMW broke free of that mold in the early 2000s with the launch of the (opinion coming in 3 … 2 … 1 …) positively hideous, Chris Bangle-designed and “flame surfaced” E65 7 Series that launched in 2001. Despite the unfortunate rear (and side, and front) of that car, it successfully allowed BMW to transition from what it was to what it is, and it has come into its own, aesthetically, in a way that can’t really be said of other brands. A BMW looks like a BMW, regardless of how you feel about angry space beavers.
Tesla, though? Tesla seems to be stuck in that “same sausage” mire that trapped BMW once upon a time. I know I’ve had trouble distinguishing a Model Y from a Model X when some other object wasn’t around to give me a sense of visual scale. I’m sure a lot of people feel the same way — and anyone who doesn’t think the Model 3 doesn’t look like Model S’ baby is kidding themselves.
Is that styling bad? No, not really. Most people seem to feel that Tesla styling ranges from “inoffensive” (me) to downright handsome (just about everyone else with a CleanTechnica byline), but if you don’t like the look of the Model X, you probably don’t like the look of the Model Y, you know? And, with no other sausages currently available, that means you’re probably shopping elsewhere.
More Choice is Good for Consumers, Bad for $TSLA
On the opposite end of the “same sausage, different length” ideology is Hyundai, which has been rollin out concepts and production cars that offer visually distinct styling elements that might appeal to a broader audience — if only because not liking the IONIQ 5 (above) doesn’t necessarily mean you don’t like the IONIQ 6.
Similarly, the expansion of viable EVs from manufacturers who are not Tesla has brought more than simply stylistic differences, but also functional ones. Even if we pretend that the Tesla Cybertruck (a mold-breaking concept if there ever was one) was a real thing that you could buy today, it’s just not as practical or functional a work vehicle as the Ford F-150 Lightning, which has the benefit of being compatible with just about every F-150 accessory on the market — from ladder racks to bed boxes to camper shells to lighting and more. That’s on top of the benefit of being a real thing you can buy.
Volkswagen, too, is selling out of its ID. Buzz electric minivans, while, on the other end of the practicality spectrum, boutique brands like Pininfarina are delivering on the promise of an electric hypercar. At the same time, Tesla’s efforts to get its Roadster 2.0 into production continue to flounder some five years after its initial reveal.
I think — and maybe you’ll agree — that what Tesla needs to continue its rapid growth is not more of the same sausage, but an expansion into more automotive product niches. And these are the ones I think it needs to go after.
An Electric Delivery Van
Amazon has Rivian. Walmart has Canoo. Everyone else? I hate to break it to the $TSLA faithful, but hundreds of fleets are out there with POs at the ready for Ford’s E-Transit and Mercedes’ E-Vito vans.
Tesla? Tesla doesn’t have anything like this (that I know of) in its product pipeline — and, even if it did, the fact remains that the company is probably still years away from entering this $990 billion global market.
A Sporty, Affordable Off-roader
Even if you could go out and buy a brand-new Tesla Cybertruck today, that doesn’t guarantee it would have the same sort of mass appeal that the Jeep Wrangler (above), Mercedes G-Wagen, or Ford Bronco enjoy. We’ll see.
A re-bodied Model Y with a bit of a lift and some off-road tires, with a bit more of a boxy “edge” to its styling and a $40,000(ish) price tag, could go a long way towards getting Tesla back on the shopping lists of people who don’t want something that blends in quite as much as the current Tesla Model Y.
The $25,000 Tesla
It’s worth noting that Benni and I disagree strongly on this one. I don’t think a low-cost Tesla is right for the brand, which has become known for holding the largest margins in the industry — and low cost, almost by definition, means low margins.
That said, if a brand-conscious buyer found themselves cross-shopping a Chevy Bolt, a Nissan LEAF, and a $25,000 Tesla Model C, I imagine they’d pick the Tesla every time — even if it didn’t offer the range or practicality (read: seats) of either of the other two offerings. Think Honda CRX instead of Honda Civic and you’ll get where I’m going with that.
But That’s Not All …
Tesla is winning the future, despite what sometimes feels like a deliberate effort from its Technoking to derail the whole thing. Still, it will take more than new models to take on and beat the likes of Toyota, GM, and Honda (which, historically, has turned a late entry into a given market into a tactical advantage).
If you’re curious about that, come back for the second half of this particular rant, where I’ll argue that what Tesla really needs in order to succeed … is dealerships.
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