Tesla punches above its weight in this big car market

Tesla Model 3

In the first half of 2022, Tesla was the second best-selling car brand in California, according to CleanTechnica. The electric carmaker’s success in the state, America’s largest auto market, is impressive, given how relatively young Tesla is and how few car models it offers. It begs the question: Can Tesla match this success in the rest of the country?

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During the first half of the year, Tesla sold 90,895 vehicles, accounting for 10.7% of the California auto market. That’s a huge jump from the 3.3% market share it had in California in 2021.

While Tesla can’t compete with Toyota’s total sales in California, the EV maker does have the two best models in the state, CleanTechnica noted. The Model Y was #1 in California in the first half of 2022, and the Model 3 was #2.

So far, the overall US market for Tesla has not been as robust as the California market, with Tesla making up only 3.3% of the US market share.

It’s worth noting that California is the leading EV market in the US. Nearly 15% of new car sales in California are pure electric vehicles, according to CleanTechnica. The percentage in California is even higher than Europe’s BEV share of the car market.

One factor influencing Tesla’s success in California is the consumer demographic of California residents, who can typically afford more expensive vehicles compared to those in other states.

It probably also helps that much of Tesla’s manufacturing is in the state. According to an analysis by Bloomberg, the Tesla plant in Fremont, California, was the most productive auto plant in America with an average production of 8,550 cars per week.

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Following a precedent, the newly opened Texas plant should help increase the supply – and possibly demand – for Teslas in the US. Tesla is struggling with delivery problems, with backlogs and some models are sold out until 2023. The long wait and unavailability of the car have driven consumers away.

Supply chain challenges have caused Tesla’s factories to remain below capacity for several quarters, the company noted in April when it released its Q1 results. Despite continuing challenges, Tesla delivered more than 254,000 vehicles in the second quarter and June 2022 was the highest month of car production in the company’s history.

Earlier this month, Tesla CEO Elon Musk said Tesla was on track to reach a production rate of 2 million vehicles by the end of this year. He also said the company could build 10 to 12 new factories to produce 20 million cars a year by 2030.

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