2023 should be decisive for the electric car, and Tesla in particular. Elon Musk’s brand remains the industry leader for now, but its position may change in the coming months. The company is indeed heckled from all sides, especially from China. Decryption of the situation.
Since the introduction of the Model S in 2012, Tesla has been the leader in electric vehicles worldwide. In 2022, Elon Musk’s company broke all records in terms of production or sales. In France, Europe and even many countries, the Model 3 or Model Y has risen as the best-selling electric car of the month, quarter or even year in many cases. But the tide could turn.
Tesla in the sights of BYD
In the fourth quarter of 2022, Tesla sold 405,000 electric vehicles. This is huge and a record. But in electric cars, the world’s number 2 Chinese giant BYD is coming very, very strong. The company has sold more than 329,000 electric cars. But the progress is huge: in the first quarter of 2022, it was only 143,223 units, while Tesla had already sold 305,407 units. And if we consider plug-in hybrids, BYD sold more than 680,000 cars in the last quarter of the year.
|Sale||you are here||BYD||volkswagen|
|First quarter of 2022||305 407||143 223||99 100|
|Second quarter of 2022||254,695||180 296||118,000|
|The third quarter of 2022||343,000||258,618||149,300|
|Fourth quarter of 2022||405,000||329,000||–|
|Total 2022||1,308,102||911 137||–|
In detail, BYD sold 235,197 electric cars in December (mostly in China). Tesla does not provide monthly figures, but it is known that the Shanghai plant rolled off 55,796 vehicles in December 2022, up from 100,291 the previous month and 71,704 in October.
A demand problem?
This is one of the reasons why many industry experts believe that Tesla has a demand problem in China. That’s why we’ve seen so many price cuts and giveaways from Tesla. The latest is this week’s historic price drop in China. The Tesla Model Y and Model 3 have never been cheaper out there.
However, the problem is moving abroad, as Tesla has also made several gifts to Europeans and Americans in recent weeks. But Elon Musk’s firm denies any demand problem. In China, Tesla explained that this price drop is possible production line optimization. This would also explain the sharp decline in production in December, which would have made possible the reorganization of the factory.
So we’ll have to wait a few more months to find out if Tesla really has a demand problem. But the American brand should not rest on its laurels. In China, after its arrival, the American manufacturer was seen as an innovative and revolutionary brand. This is less so now as many domestic manufacturers are offering more innovative electric vehicles.
It covers a distance of 1000 km and charges in 5 minutes
We can cite the Zeekr 001 from the Geely group, which is the first electric vehicle to incorporate CATL’s new battery Qilin CTP 3.0. What’s special about it? Offer 1000km range in Chinese CLTC cycle thanks to exceptional power (but high consumption) of 140kWh. We suspect Tesla could do just that with the (delayed) 4680 battery and the canceled Tesla Model S Plaid+. Reason: according to Elon Musk, nobody needs a car with more than 600 km of autonomy. As long as you fill the car quickly, you can’t go wrong.
And more precisely, in the matter of fast charging, Elon Musk in 2013 demonstrated the Tesla Model S with the ability to “charge” in 3 minutes thanks to the exchange of batteries. Then it was faster than a full tank of fuel! But the brand has since abandoned the idea, which has since been adopted by Chinese manufacturers. Thanks to Nio, this is no longer an idea, but a reality in China and Europe, where there are already 10 battery exchange stations. We were also able to test the feature which was amazing and fast.
Aside from the battery swap, the v3 Superchargers are rumored to be able to reach 250kW of peak power, while the v4 Superchargers could reach 350kW. But that figure pales in comparison to the Geely’s 600kW or the Nio’s 500kW. It is enough to charge an electric car from 10 to 80% in just 10 minutes. As long as you have the 800-volt architecture that Tesla’s electric cars don’t have. Except for the Tesla Semi, but it’s certainly a revolutionary electric truck.
BYD’s European offensive
Unfortunately for Tesla, the Asian competition is not limited to these technological displays. In France, Chinese giant BYD took advantage of the 2022 edition of the Mondial de l’Auto to arrive in the country with three electric cars: BYD Atto 3, BYD Han and BYD Tang. If we compare these cars with Tesla, they are a little disappointing in terms of specifications. But their aggressive pricing positions may hurt other manufacturers in the long run.
A few days ago, BYD introduced its new premium brand, YangWang. In the program: luxury cars that contain the best in terms of technology. We have the YangWang U9 electric supercar, but above all the electric 4×4 that competes with the Tesla Cybertruck, Land Rover Defender and Mercedes EQG: the YangWang U8, with over 1000 horsepower and advanced technologies.
Remember when Elon Musk announced a few months ago that the Cybertruck could be used as a boat on bodies of water? Well, BYD pulls the rug out from under Tesla’s feet with an impressive demonstration: YangWang, which enters a deep lake, can swim back to solid ground with the help of its four engines.
Autonomous driving: Tesla’s secret weapon?
On the autonomous driving side, Tesla remains the undisputed market leader at the moment, although it is slowly being overtaken by Mercedes, in particular the first manufacturer to offer a car with level 3 autonomous driving thanks to 100%. electrical EQS.
But Chinese manufacturers are not going to be left behind. Zeekr recently proved this again thanks to its partnerships with Mobileye (Intel) and Waymo (Google). But this also applies to Xpeng, a manufacturer whose cars are sold in Norway and is working on autonomous driving similar to Tesla’s FSD (Full Self-Driving) system.
And to be precise, for the moment, Tesla’s FSD autonomous driving is only available in the US. Other countries have to make do with Autopilot, a Level 2 drive designed for highways and motorways. FSD is a feature that can be activated anywhere, including complex city centers.
2023: A crucial year for Tesla
Tesla is equipped with weapons that allow it to maintain its leadership: high-level autonomous driving, cars with record efficiency and the most advanced network of superchargers in the world. But its future hangs in the balance because the Chinese threat is real and not just localized. Chinese manufacturers have the will to occupy the European market as well as the American market in the long run.
To counter this onslaught, Tesla needs to strike hard, not just with price cuts. The American manufacturer needs to restore the previous level of innovation and catch up on certain elements, for example, ultra-fast charging (and this will especially include the 800-volt architecture) and even more affordable cars.
Rather, Elon Musk’s company will reveal certain details about the brand’s third electric platform in March 2023. It is rumored to form the basis of the future Model 2 and autonomous robotaxis. Many believe that Tesla’s compact electric car will be similar to Foxcon’s Foxtron Model B.
2023 could also be the year Tesla becomes the first manufacturer to place an electric car on the podium of the world’s best-selling cars of the year, combining all engines. Even better, the Tesla Model Y might just be the best-selling car of the year, surpassing the Toyota Corolla, which currently holds the title.
Elon Musk’s company can do this, because if its factories are running at full speed, 2.5 million electric cars can be produced every year. Compared to the 3 million electrified vehicles (rechargeable hybrids and electrics) that BYD can produce annually.
What if Tesla deploys FSD in China to return to being the country’s innovation leader? This may allow it to overshadow local competition. We hope that the return of COVID in China will not interfere with the plans of Elon Musk’s company. Just like his Twitter antics. Thus, 2023 promises to be decisive for Tesla and Elon Musk.
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