- The electric car race started in 2010, but now it’s basically over and Tesla has won: CEO Elon Musk’s car maker dominates the electric car market.
- But that market is still small, accounting for only about 2% of global sales.
- Musk knew that for Tesla’s grand vision to be successful, that market share had to grow exponentially.
- Winning the EV race means that for Tesla, the elimination of the internal combustion engine is really just beginning.
- Visit the Business Insider homepage for more stories.
The idea that automakers are racing to commercialize electric cars ̵1; and one or more of them will appear on the market – is always flawed.
For starters, the auto industry is huge: More than a billion passenger vehicles are traveling around the planet, with another 80 million joining them each year. No winner can match that level of need.
This was evident even in the early days of the auto industry, when automakers, engine manufacturers, and car builders were competing to put Americans and Europeans at the wheel. Yes, there are clear winners and losers: Henry Ford soon gained a large share of the market with his Model T, then General Motors became a competitor and leader. But over the past century, both are continuing, more or less fine. That’s not how races work.
In the 20th century, many other famous names joined in this act. Brands were gone, such as Studebaker and Nash. Mid-century emerging companies like Chrysler. Europeans have always been a factor: Mercedes, BMW, Fiat, Ferrari, Rolls-Royce, Aston Martin, Rover, Vauxhall, Renault, Citroën. Mighty Volkswagen. After World War II, a variety of Japanese brands flooded in: Toyota, Honda, Mitsubishi, Nissan, Mazda, and Subaru.
The point is that on a planet of billions of people, a significant percentage of wanting to move personally, you need multiple automakers to meet demand and share the risks of trying to meet demand. that bridge.
However, it is the era of internal combustion. That still accounts for about 98% of the global market. Meanwhile, on the electrification front – which accounts for 2% of worldwide sales – had a clear winner: Tesla.
A single statistic tells the story. The Nissan Leaf, an EV that debuted in 2010 before the next Tesla Model S in 2012, has sold just over 400,000 units. Tesla is currently hitting one million, for the five vehicles it has sold since its inception (the original Roadster, Model S, Model X, Model 3 and Model Y).
After that, Tesla had almost a monopoly in a small market. The race, such as it is over, and Tesla can declare victory. But here’s the problem: CEO Elon Musk knows the race is a false story, a race that doesn’t matter. Here’s why: