Tesla‘s Market Shares Falls in U.S

$Tesla(TSLA.US) According to a report by Reuters, data from Cox Automotive reveals that Tesla's share of electric vehicle (EV) sales in the U.S. dropped to 38% last month, marking the first time since October 2017 that it fell below the 40% threshold.

This decline in market share comes amidst intensified promotional efforts by competitors such as Hyundai, Kia, Toyota, and Honda, whose EV sales surged by as much as 120% in July.

Stephanie Valdez-Streaty, Director of Industry Insights at Cox Automotive, commented, “I understand Tesla sees itself as a robotics and AI company. However, when you’re fundamentally still an automaker, a lack of new product launches will inevitably lead to a drop in market share.”

Tesla's most recent major product release was the 2023 Cybertruck, which has failed to garner the popularity of its best-selling Model 3 sedan or Model Y SUV.

Although Tesla upgraded the Model Y earlier this year, its changes fell short of expectations. As a result, Tesla is bracing for a second consecutive year of declining sales.

The increasingly competitive market environment is fueled by two key factors: generous incentives from automakers and the impending expiration of the U.S. federal EV tax credit at the end of September. Analysts expect this expiration to create short-term pressure, leading to heightened EV sales in the coming weeks.

Reuters highlighted that Tesla once dominated the U.S. EV market with a peak share of 80%. However, as competitors continue expanding their product lines, Tesla’s position has steadily eroded.

Even though Tesla’s sales rose by 3.1% in August, the overall U.S. electric vehicle market grew by 14%, underscoring Tesla’s lagging performance relative to broader market trends