Will Tesla Break the Electric Vehicle Sales Record in 2015?
With the electric vehicle sales totals in for May, we have five months to work with when plotting the course for 2015. Overall, the segment has been in a relative slump, with sales down for plug-in EVs compared to the numbers from a year ago. However, Tesla Motors has been a bright spot with gains over 50% this year with the company’s increased production capacity, much to the relief of Wall Street analysts. Here’s a look at whether Model S can break the all-time EV sales record this year and what that means for the segment.
Looking at the single-year U.S. sales record set by the Nissan Leaf in 2014, Tesla appears set to challenge the segment’s high-water mark. Nissan moved 30,200 models of the Leaf in 2014 after passing the previous record (22,610) it set had set in 2013. The Leaf’s pace through the first five months of last year gave it 10,389 sales by the start of June.
While we do not have an exact quote of Model S sales through May 2015, we have enough information to get a picture of U.S. numbers. For starters, we learned from Tesla’s quarterly sales report that the company delivered 10,030 cars (global) in the first quarter, which the reliable InsideEVs sales tallies estimated at 4,700 in the U.S. market. Multiplying that figure by four, Tesla would be 10,000 cars short of the record.
However, production and deliveries are scheduled to ramp up considerably, with the automaker averaging about 15,000 for each of the next three quarters in order to meet the stated goal of 55,000 cars (including Model X sales) in 2015. Of the approximately 45,000 left for the year, U.S. buyers would have to take about 57% of the share (25,500), and at least some of those would be Model X utility vehicles.
Based on those numbers, Tesla breaking the EV sales record is a long shot in 2015, and if it did we would have to add an asterisk for the arrival of the Model X. However, the company’s ability to even come close (or break the Leaf’s 2013 milestone) would mark a triumph for the automaker’s mission and bode extremely well for forthcoming products. Model S prices, ranging from $75,000 (S 70D) to $105,000 (P85D) before extras, are a far cry from the Nissan Leaf ($29,010) and a number of other EVs near or below $25,000 once incentives are counted.
What Tesla has offered to consumers is considered a value at its steep price once you factor in the range (240 miles to 270 miles) and muscle (329 horsepower to 691 horsepower). Skeptics who believed an electric vehicle maker could never compete at this price point underestimated the impact a performance car — one that happened to be electric — could have on the market. (For more on that, consider how a $140K BMW plug-in outsells the Smart Electric Drive, priced at $20K.)
Those who believe Tesla is the electric vehicle manufacturer with the potential to reach the mass market point to the Model S’s winning formula. But will consumers shrug off compromises in performance and luxury to get a Model 3 costing less than $40,000? There are risks (and lower profits) involved with the shift to higher volumes, but all signs point to as much demand as the automaker can satisfy. (We are several years away from seeing any such car.)
For now, the fact Tesla is challenging the EV sales record in 2015 should be a word to the wise automaker. Consumers will pay more for quality when the range does not hamper lifestyle and the performance makes the drive a pleasure. That’s how a vehicle costing near six figures is competing for a record set by a car costing less than $25,000 after incentives.