Tesla Model 3 Already Gobbling Premium Gas Car Sales, It Seems


There’s no doubt about it — 400,000 reservations for a single model is a big deal. For several months (since last year, even), we’ve discussed how this could be (likely is) decreasing Nissan LEAF, BMW i3, and other pure-electric car sales. However, that market doesn’t seem to be affected to the tune of ~400,000 cars — the entire global EV market was just 540,000 in 2015, and it continues to grow in 2016.

It seems likely that the bigger effect will be seen in the premium gasoline & diesel car market. Questions about how these markets have been doing recently came up on the TMC forum. One proactive member, RubberToe, subsequently shared the following table, which shows the change in sales for a variety of potential Model 3 competitors — March 2016 vs March 2015, April 2016 vs April 2015, May 2016 vs May 2015, and 2016 through May vs 2015 through May. As you can see, almost every car on the list took a significant hit to sales:

Tesla Model 3 Competitors

Since those numbers didn’t include June, I just tallied up the June totals as well as a supplement, but removing the Toyota Prius since I’m not sure how much of a competitor that is, and I’m more interested in examining the small to medium luxury sedan market, and adding the Audi A3, Audi A4, BMW 4 Series, Mercedes CLA Class, and Acura ILX (a huge thanks to Viktor Irle of EV-Volumes for the guidance). Here’s the table:

Model 3 Competitors 4

Nothing to write home about for these automakers, and that’s amidst an overall increase in the US car market.

Naturally, there are a variety of factors at play here. However, I’m not thinking up any significant, across-the-market influences that could be driving a considerable drop in demand/sales … other than the Model 3. Any ideas? [Edit: Viktor Irle and commenter Adrian have noted that premium-class CUVs and SUVs are selling well, which could be a significant part of the explanation as well. Unfortunately, I don’t think anyone is prepared to do a regression analysis to tease out an unequivocal answer here.]

And let’s recognize that we’re still well over a year away from the start of deliveries, if everything goes as scheduled. That 35,000-car drop across the models in the table could swell as we come closer to the Model 3 rollout. Hold onto your seats, people!


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8 thoughts on “Tesla Model 3 Already Gobbling Premium Gas Car Sales, It Seems

  1. Good. Good. Very good.

    I’ve seen people bad-mouthing Tesla as if Elon is some sort of con-artist trying to steal millions from Tesla pre-orderers… and, yes it can be confirmed as a result, that unfortunately, paranoid lunatics do still have access to the internet.

    Can’t wait for my Model III; the rEVolution starts here!!

    1. Haha, yeah. 😛

      Also, FYI, I just updated the article, as several competing models weren’t originally included. The story is even worse for them now… 😛

  2. Nice article! And promising. Unfortunately, the fact that there’s only a partial selection of the “small to medium luxury sedan” contenders makes it feel like some cherry-picking may be going on. Cars like the VW Passat, Toyota Camry or Mazda Mazda6 are very likely to be direct competitors, no? The criteria for inclusion in the list should simply be MSRP $27,500* to maybe $45,000, “sedan” and sold in the USA.

    Also, ideally there would be something that shows sales figures both before and after the Reveal 1 announcements, otherwise, this trend is harder to explain with the Model 3.

    * The reason for the starting price of only $27,500 is that ICE competitors won’t see the $7,500 Federal Tax Credit.

    1. Yeah, we could do some follow-ups. I was basically jumping off of the table someone shared with me, and basically added in the other small and midsize premium cars. I think those are basically Tesla’s competitors. Though, just as Model S buyers came from all over the map, to some extent, Model 3 buyers will as well.

  3. People still buy those gas cars, because they think Tesla will be late with Model3. When Tesla gets closer to actual production, sales of those gas cars will really tank. Between a Tesla and those, the choice is obvious, and the only thing saving them for now is Tesla itself.

  4. I’m sure various factors play a role for various models but it could be significant that the sales of one of the competing ICE models that is conceptually really close to Model 3 has really tanked. That would be BMW 4 series. 3 series sales are still holding up, the only other premium compact sedan that sells in the sort of numbers that Tesla is shaping up to be selling but at some point Model 3 sales is bound to impact those as well as there is only so much cash chasing $40K cars around.

  5. Probably equally the case that the buyer are migrating within the brands to respective Suvs. Audi q5&7. Bmw x et al

    Let’s call it 300000 world wide and 150000 in the US. By the time it arrives Ze germans will have 500mile phevs. That go like a scolded cat and use next to no fuel on a daily basis.

    The challenge for tesla is after the intial honeymoon period the mid luxury customer is prone to huff and puff about its short range relatively speaking.

  6. I’m surprised you mention only the Tesla and not the Chevy Bolt. From where I sit (a long way away, the Bolt will be on the market first, maybe six months to a year ahead, with almost identical specs and a similar price. For me at the moment its the Bolt that is the real game changer.

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