Tesla established the modern-day electric car market — and in doing so, achieved a massive jump on EV manufacturers. And even a decade or so later, the brand maintains an overwhelming advantage in EV market share. But other automakers are looking to change that. One of them is General Motors, which plans to phase out combustion vehicles entirely by 2035.
GM's CEO, Mary Barra, recently told Yahoo Finance that the company would overtake Tesla by mid-decade, which is technically less than three years away. “We have said that by mid-decade, we will be selling more EVs in this country than anyone else, including Tesla," Barra told Yahoo Finance.
According to Barra, GM plans to achieve that by selling relatively affordable EVs.“Remember, we're not necessarily just selling at the premium end,” Barra said. “We're going to have electric vehicles affordable at $30,000.”
Tesla has been increasing prices in recent years, leaving room for them to be undercut. The cheapest RWD Model 3 now starts at $46,990; that jumps to $55,990 if you want AWD. And the most affordable Model Y now starts at $62,990 (and won't be delivered until November 2022 at the earliest). Tesla is no longer eligible for the $7,500 federal tax credit, although to be fair, neither is GM.
To overtake Tesla, GM will need to start selling more EVs in a hurry. The manufacturer sold fewer than 25,000 of them in 2021. They sold 24,828 Bolt EV and EUVs (and one Hummer EV pickup). Tesla sold more than 900,000 EVs in 2021. And the target for being the best-selling EV manufacturer by the end of the decade will move. Ford, for instance, has plans to produce more than two million EVs per year by 2026. Crucial to GM's effort will be the upcoming Equinox EV, which will start at around $30,000.
Manufacturers have a long way to go to catch up with Tesla. But they are in the process of doing so. They haven't yet faced the complete manufacturing might of the Ford Motor Company and GM producing the conventional pickups and SUVs buyers want yet. Tesla also hasn't experienced established brands like Mercedes, BMW, Lexus and Audi offering robust lineups of credible EV alternatives.
Tesla will still likely be in a strong position. But we strongly doubt the brand will still be commanding more than 70% of the EV market in the latter half of the decade.