Tesla’s European sales plunged more than 90% in April as Volkswagen and Audi pinned down

Tesla’s first-mover advantage is running out, and the market is returning to normalcy

Tesla's European sales plunged more than 90% in April as Volkswagen and Audi pinned down

On May 28, EV Sales, a new energy vehicle sales statistics website, released its April 2021 ranking of new energy model sales across Europe, with Tesla unexpectedly falling out of the top 20. 1,244 Tesla Model 3 units were delivered in Europe in April, down 95% from 28,184 units delivered in March.

In April 2021, the Tesla Model 3 also suffered a sales plunge in China, with a drop of more than 70 percent from the previous year. At the time, data showed that more than 14,000 Chinese-made Model 3s were exported to Europe, which was considered one of the major reasons for Tesla’s plummeting sales in China. But the above data shows that this reason is not valid.

What’s going on with Tesla, the “No. 1” smart electric car?

Through interviews with local consumers in Europe and comprehensive data analysis, the reporter from Finance and Economics believes that the impact of cyclical fluctuations and the strength of competing models have jointly caused Tesla’s sales avalanche.

01 April is a cyclical down month
As shown in the chart below, in March this year, Tesla’s European sales surged abnormally because Tesla sharply lowered the European selling price of Model 3 on January 21.

In Germany, for example, the three models of Model 3 were reduced by 3,000-4,000 euros, and the entry version was reduced to 39,990 euros, while 40,000 euros is an important threshold for subsidies for new energy models in Germany, below which the subsidies will be raised from 7,500 euros to 9,000 euros, and the price cut additional subsidies, and the January 21 price adjustment for the entry version of Model 3 brought the actual Offer up to 5,500 euros. This brought a booking surge, but because Tesla so far has no manufacturing base in Europe, so the late January surge in orders are delayed to February-March delivery, pulling up the two-month Tesla Model 3 delivery figures.

The impact of the price drop faded in March, with Model 3 delivery wait times in various European countries returning to a normal cycle of 3-4 weeks, up from 5-6 weeks at the time of booking in February. Since Tesla does not have a manufacturing base in Europe, each sky-high delivery is followed by a dip in monthly delivery figures, which happened twice in 2020, in April and October.

Every year in April, the European passenger car market produces a cycle of decline, very similar to the Chinese market, which is closely related to the product planning cycle of mainstream car companies.

In April 2019, European new energy vehicle sales fell 37.88% YoY. In April 2020, the volatility was doubled by the epidemic, with European passenger car sales as a whole falling 78% YoY and new energy vehicles falling 63% YoY, with the Tesla Model 3 falling even more, by 85%.

In April 2021, total European new energy vehicle sales fell 29.86% YoY and returned to normal, while Tesla’s YoY drop was as high as 95%, which cannot be explained by cyclical fluctuations only.

02 VW Audi pinches Tesla
In addition to cyclical factors, the several models in the table below that bucked the trend well explain another reason for Tesla’s plunge – the Volkswagen Group started to go full throttle in the European new energy vehicle market. Compared with cyclical factors, this reason is more important.

Among the sales changes of the main sales models, the two VW ID models performed the most brightly. ID.3 continued the good momentum since its launch in Europe, and even under the downward pressure of the market in April, still delivered an increase of nearly 19% YoY. ID.4 achieved even brighter results, starting with volume deliveries in Europe in March, ranking fifth in sales that month, and topping the European sales in April. The two ID models formed a huge pressure on the Model 3.

In addition to the entry market, the Audi brand of Volkswagen also continues to squeeze Tesla’s market space in the field of high-end luxury new energy vehicles. e-tron sales rose 19.45% in April. e-tron has been listed for more than a year, sales performance shows that this car has ruled the European luxury pure electric car market, compared to the sales performance of Tesla’s Model S and X are The sales performance of Tesla’s Model S and X are lackluster. Local consumers in Europe told the C&C reporter that in the luxury car segment, Tesla’s workmanship and relatively maverick design give consumers a generally negative impression.

Considering the time cost of logistics and customs clearance, more than 14,000 Model 3s exported from China to Europe will be delivered to European reservation users one after another in May, so Tesla’s European sales in May deserved a significant rebound. But under the strong pressure of the VWID duo, the Model 3 wants to recreate the glory of breaking 20,000 monthly sales in Europe, which is extremely difficult.

On May 28, the same day the European new energy vehicle sales list was announced, U.S. specialized media Electrek.com posted an article saying that Tesla had sent an email to owners to initiate a voluntary recall of the Model 3 and Model Y models, with the aim of checking the tightening bolts of the tire brake calipers.

The email says, “The brake caliper fastening bolts on certain specific vehicles may not be tightened in place to the correct torque. Over time, the bolts may loosen, causing the brake calipers to contact the wheel hub, resulting in rattles, restricted tire rotation or even loss of tire pressure. The vehicles involved are Model 3s produced in North American plants from December 2018 to March 2021 and Model Ys produced from January 2020 to January 2021.”

The brake failure controversy has long been with Tesla, both in North America and China, with a large number of complaints of Tesla brake failure, and this voluntary recall involves precisely the brake calipers, which could potentially lead to failure phenomena among which the restricted tire rotation could affect the wheel speed sensor and lead to ABS failure. Loss of tire pressure can also cause the brake system to work improperly.

With plummeting sales and voluntary recalls, Tesla’s second quarter got off to an extremely disastrous start, but this is actually a return to the market norm. The new energy vehicle market is a strong, fully competitive market.

As competitors rise to the occasion, Tesla’s first-mover advantage is being gradually eroded, and the new energy vehicle market has entered the era of the herd.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/teslas-european-sales-plunged-more-than-90-in-april-as-volkswagen-and-audi-pinned-down/
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