A large number of gas car owners are being converted into EV owners. Tesla recently released its trade-in statistics in the Q1 2021 earnings call update letter. The letter revealed that the company accepted a majority of gas-powered vehicles through trade-in.
Tesla also revealed that it has accomplished another profitable quarter thanks to an astonishing delivery result, more than 184,000 electric vehicles were sold in China and around the world. Both Model 3 and Model Y were the most popular choice.
Along with that, Tesla is expanding the production efforts by building the Texas Gigafactory and Berlin Gigafactory, which is expected to start producing Model Y by late May 2021 and July 2021, respectively. The company is also increasing its gross margin and decreasing manufacturing costs that resulted in a positive quarter for the electric automaker behemoth.
However, the fact that the gas car owners are being converted into EV owners at a breakneck speed is impressive. While the market share for the automotive industry still depends heavily on the production and sale of gas-powered vehicles. Electric vehicles are slowly making their presence known to the world.
According to Statista, Tesla has a commanding lead over second-place Volkswagen in EV sales by the manufacturer in 2020. Compared to Volkswagen which only sold 220,220 electric vehicles, Tesla sold 499,550 electric vehicles in 2020.
Tesla revealed that 98% of the trade-in are gas-powered vehicles. Nearly 60% of the trade-ins came from non-premium brands such as Ford, Honda, Toyota, and Chevrolet. Approximately 40% of the trade-ins are premium brands like BMW, Audi, and Lexus. The remaining 2% are EVs which proves the competition is the other gas-powered vehicles.
Elon Musk said that it has always been Tesla’s objective to produce more EVS and get them on the road. Doing this will require displacing the gas-powered vehicles and the electric automaker has made it possible by offering customers an appealing option to the predecessors.
More customers are starting to realize the advantage that electric vehicles bring to the table such as lower fuel cost, low maintenance costs due to fewer moving parts, and overall improved safety. The increase in EV market share further bolsters Tesla’s dominance in the energy and the electric sector as people are transiting from fossil fuels, oils, and coals to renewable sources of energy.
Early this month of April, President Biden plans to roll out a $174 billion bill that aims to electrify the United States infrastructure. The infrastructure bill will either come in form of federal EV tax credit or a rebate that the customers can take advantage of when purchasing a brand new electric vehicle.
It has not been decided whether the new federal EV tax credit will work against Tesla or not as initially proposed by the U.S congress. The demand for electric vehicles continues to rise even after Tesla price hike Model 3 and Model Y for the fourth time.