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Home » Tesla Lead in EV Continues to Widen as Legacy Automakers Struggle to Catch Up

Tesla Lead in EV Continues to Widen as Legacy Automakers Struggle to Catch Up

Canaccord Genuity just cut his price target on $TSLA from $267 to $234

It was supposed to be the year that traditional automakers finally mounted a challenge to Tesla’s dominance in electric vehicles. But as 2023 gets underway, Tesla continues to expand its EV lead over the competition.

In the US market, Tesla is increasing production capacity at a pace that exceeds all legacy automakers combined. After a decade of being trounced in EVs, major manufacturers like GM, Ford, and Volkswagen are still scrambling to catch up.

Tesla now accounts for a staggering 61% of all fully electric vehicles ever sold in America. This makes it more dominant in EVs than Apple is in smartphones.

And Tesla continues to set new affordability benchmarks. Earlier this year, the base price of a Model Y was $20,000 above the average new car transaction price. But through manufacturing efficiencies, Tesla has now priced the Model Y $4,000 below average – an incredible feat.

Tesla Model Y

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The Model Y is on pace to become the world’s best-selling vehicle of any kind in 2023. Tesla remains years ahead of rivals in battery costs and EV efficiency.

Globally, Tesla’s chief EV competitor is China’s BYD. Like Tesla, BYD decided in 2021 to stop making gas vehicles entirely to focus on EVs. Within two years, it surpassed VW as China’s top selling auto brand.

Tesla finds itself in a similar position in California – now the #1 brand overall on the back of EV leadership in California. As Volkswagen CEO put it, “the house is on fire” in regards to the seismic industry shift underway.

And Tesla aims to light a new fire with its Cybertruck EV pickup. Love it or hate its looks, the Cybertruck represents a bold play for the profitable truck market. Legacy truck makers seem wholly unprepared for Tesla’s pending assault.

In EVs, scale brings efficiency which enables scale – a virtuous cycle that now threatens major automakers. The auto industry is being disrupted by the same forces that allowed legacy automakers to dominate for the past century.

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