Tesla is still the dominant electric vehicle brand in the United States. But just as the EV market is heating up with exciting new entries from legacy brands including Mercedes-Benz, BMW, Volkswagen, Cadillac, and even Rolls-Royce, as well as newcomers Lucid, Fisker, and Rivian, Elon Musk and his alt-right Twitter frenzies are alienating Tesla’s most avid customers: Southern California liberals.
Musk couldn’t have chosen a worse time to find his divisive political voice. Tesla’s market-leading share of new electric vehicle sales dropped to 59 percent in 2022 from 66 percent in 2021. That tumble is likely to continue this year as a fleet of luxurious EV newcomers flex their sheet metal, promising the next shiny must-have. With the electric vehicle segment finally gaining traction—EVs made up 5.1 percent of all new vehicle sales in the U.S. in 2022, up from 2.6 percent in 2021, a 96 percent increase—this is not the moment for mojo-killing social media posts from Tesla’s putative brand ambassador.
We felt like we were driving in a MAGA hat, as if Tesla was a symbol of white supremacy.
Tesla’s latest earnings report showed a record annual profit, but the company missed its delivery target for 2022, which was ambitious given the global supply-chain shortage. Add to that the PR disaster and potential legal consequences of February’s 362,758-car recall for Tesla models equipped with the company’s benighted Full Self-Driving software, which has been implicated in multiple crashes, some fatal. “They did well financially, but there is concern that perhaps demand isn’t as strong as Elon paints it to be,” says Jessica Caldwell, an analyst at Edmunds, the automotive research website. “It feels as if there are clouds on the horizon.”
As automakers pivot to all-electric powertrains by 2035, Americans are looking beyond Tesla for what their first (or second or third) family EV will be. For many, Musk’s outrageousness is making the decision easy. All this begs the question: Is Tesla, the once-mighty and virtuous vehicle of the future, in real trouble?
Musk need look no further than this 64-year-old Hollywood insider who recently dumped her 14-month-old Model Y for a 2023 BMW iX xDrive50 EV after Musk retweeted a far-right conspiracy theory about the attack on then-House Speaker Nancy Pelosi’s husband, Paul.“The guy should write a book on how to destroy your brand in three months,” she says of Musk. “It got to the point where we felt like we were driving around in a QAnon-MAGA hat, as if Tesla had become a symbol of white supremacy.” Retweeting the Paul Pelosi conspiracy was the final straw, she adds. “We sold our Tesla to our neighbors—who got a great deal, by the way. And guess what we discovered driving the BMW? We love it more than we ever did the Tesla.”
Tired of Tesla’s decade-old design and Musk’s far-right shenanigans, one L.A. attorney plunked down a deposit on two Lucids—one of the new crop of luxury EV upstarts—to replace the Teslas he and his wife currently drive. Of the Lucid, he says, “It’s a billion times more gorgeous and luxurious than our Teslas. And there was no bigger fan of Tesla than me. I probably sold 40 or 50 cars for [Musk] through my friend network over the years, but that’s over. I think he’s dangerous.”
Meanwhile, Tesla’s lack of innovation beyond its initial efforts a dozen years ago is priming competitors like Mercedes to blow the gull-wing doors off of Tesla’s tech dominance. For all of Musk’s bluster about Tesla’s self-driving prowess, it’s a Luddite compared with Mercedes’s Drive Pilot autonomous system, an $8,000 option on its new EQS electric models, which has been approved for use on Nevada roads beginning early next year, with plans for a larger rollout.
Still, there are plenty of Tesla stalwarts, or at least satisfied customers—even those who personally don’t care for Musk so much.
“For me, I can own and love the car and hate what he stands for,” says Lisa Mendel, a Los Angeles realtor. “I love its responsiveness, its braking, and its acceleration. Please don’t judge me for loving my Tesla.”
Producer David Friendly (Little Miss Sunshine) has no plans to sell his Model Y because of Musk’s antics. “I’m not having dinner with him; I’m just driving his car,” he says. “This car is more fun than any car I’ve had, and I’ve had Mercedeses and Porsches.”
Phil Rosenthal, star of the Netflix series Somebody Feed Phil who wishes Musk would shut up, still loves his Tesla. So much so that, rather than buy a new EV, he recently spent $15,000 on a set of fresh batteries for his 12-year-old Model S. “I bought that car before Musk was this, and that’s how I justify it. It seems that keeping the car is the best thing for everyone, including the environment. It really is the best car I’ve ever owned.”
Indeed, a not-insignificant number of left-leaning drivers are still buying Teslas while ignoring the right-wing machinations of Musk the man.
“I despise Musk as a human being, but his car can be good, and I feel like I’m buying one of the better, proven EV cars out there,” says Eric Heggen, a Los Angeles architect, who drove to San Diego to purchase a Model 3 during the last week of January, shortly after Musk slashed prices. “I’m taking advantage of Musk’s weakness as he’s desperate to keep his position.”
Meanwhile, Hyundai and its sister marque, Kia, not long ago considered middling brands, have captured the attention of the automotive press and consumers for their EVs’ chic looks, advanced technology, and luxury appointments. Hyundai and Kia sell the second-highest number of EVs in America, behind Tesla, with 10.1 percent of the market, more than double their previous year’s market share. Hyundai’s Ioniq 5, a stylish $52,000 SUV, is exactly the kind of mass-produced electric that could diminish Tesla. And Hyundai’s luxury Genesis marque has several posh EVs on the near horizon aimed directly at Tesla’s premier Model S.
Musk still has some tricks up his sleeve. The prototype Cybertruck, a radical stainless-steel-clad pickup that looks every bit like a child’s Transformer, has had longtime Tesla fanatics drooling for years. Musk has been promising since 2020 that the angular beast is just around the corner, and pledged in January that come early 2024, it really, really will go into production. If true, it won’t happen a moment too soon.
The EV sharks are circling.
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