Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!
For years, Tesla sales grew at a clip of about 50% per year, on average. That was supposed to continue through the 2020s. However, we started noticing signs of Tesla consumer demand challenges about a year ago. Tesla started offering more and more incentives and price cuts in order to move the desired volumes. It’s even been said that Tesla paused production growth plans due to demand not rising as expected. Of course, there have been many layoffs and high-profile executive departures in the past year as well.
Before I go further, let me note again that we’ve been covering the Tesla story very closely since 2012. We debunked countless myths about the cars, Tesla Supercharging, and the company as a whole. I personally dispelled enough misinformation to fill a college textbook. For years, I and others here predicted strong Tesla growth, Tesla profitability, and disruption of the auto market from Tesla. And we nailed it. However, past success doesn’t guarantee future growth. As signs of demand challenges started popping up, I and others have tried to objectively understand what is happening. From “natural limits” of consumer demand for two mass-market Tesla models (thanks for the terminology, José Pontes), to growing competition and rapid innovation in key markets, to political firebombs and brand challenges, to lack of new models or model variations, there are a lot of factors to discussion. But I don’t claim to know what will happen one way or another in this case. It’s too difficult to forecast.
Elon Musk himself actually said once about a year ago when asked about mid-term or long-term demand that they don’t have actual specific numbers, because no one really knows. However, earlier this year, when Tesla had a year-over-year sales drop in the 1st quarter of 2024, as concerns about future Tesla sales and profitability really surged, Musk said that the company would have sales growth in 2024 as a whole. He didn’t provide any specific forecast, though. My questions since then have been, “Is the company really going to have sales growth across 2024? What will lead to that — that is, what will change to get the company back on a growth path?” But I sat back and waited for the numbers to come in.
In the 2nd quarter, again, Tesla showed year-over-year sales decline. At this point, I’m starting to really wonder. How is Tesla planning to bounce back and counteract the results of the first half of the year? Not only does the company have to start posting year-over-year growth again, but it also has to make up the deficit it has accumulated if it is going to make Elon Musk’s forecast an accurate one. That’s 88,800 after the first half of the year. We now have some data from the 3rd quarter from key regions, so let’s look into it. Of course, this not for the full 3rd quarter (which isn’t over) and it’s not for the world as a whole, but it’s a starting point.
In China, Tesla 46,227 registrations in July, up 47.1% from July 2023. Then, it had 63,456 registrations in August, down 1.9% from August 2023. So, sales are indeed up in net in China in the 3rd quarter. That’s despite still being down January–August in the country compared to 2023. In short, Tesla seems to be getting back on its feet in the largest EV market on the planet by far.
In Europe, looking at July data, the Tesla Model Y is still the top selling EV on the continent, but its registrations were actually down 16% year over year. The Model 3, meanwhile, was down 14% year over year. So, Tesla is still losing sales in this other major market.
In the US, data is not in yet, but much of the bleeding happened in California, Tesla’s most crucial US market, in the first half of the year. There’s no clear sign that the trend has changed, but we’ll just have to wait to see.
So, in short, the jury is still out about whether Tesla can reverse its 2024 sales trends globally in the 3rd quarter, or in second half of the year as a whole. There are net positive signs out of China, net negative signs out of Europe, and nothing to make me optimistic about the US market. I still wouldn’t bet on 2024 ending up as a growth year for Tesla, but I also wouldn’t bet against it just yet. I could see Tesla having a strong 4th quarter (somehow) and eking out slight year-over-year growth. But I could also see Tesla’s struggles continuing and the company ending with its first down year in … forever. If I was forced to guess, I’d guess that the latter is more likely. We’ll see, and I’ll be sure to track the trends more closely in this second half of the year. Stay tuned!
Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.
Latest CleanTechnica.TV Videos
[embedded content]
Advertisement
CleanTechnica uses affiliate links. See our policy here.
CleanTechnica’s Comment Policy
Share this story!