German car manufacturer Volkswagen is predicted to overtake Tesla as the top electric vehicle company globally by 2024. The VW CEO Herbert Diess told CNBC in May that the company was aiming to overtake Tesla in EV sales by 2025. That's a bold statement for a company that still sells internal combustion vehicles, and its electric lineup includes hybrids. Its BEV (battery electric vehicle) business saw a 95 percent increase year-over-year, so the company could be on the right track. It's growing faster than Tesla, but it was producing fewer electric vehicles to begin with.
Tesla reported solid quarter-one earnings but expected supply chain issues to impact its production for the rest of the year. The company delivered over 310,000 in quarter one and produced more than 305,000. On the other hand, VW delivered only 99,064 globally in the first quarter, which was 65 percent more than 2021's first quarter. If the German car brand keeps up this trend, it may catch up and overtake Tesla, but the EV company is also ramping up production to meet demand. Just this week, Elon Musk said it was increasing production for Model Y because of the length of delivery times in Australia.
A study by Bloomberg Intelligence predicts that Volkswagen will take Tesla's crown as the largest EV company by 2024. The "Battery Electric Vehicles Report – Automakers Race to the Top" found that most traditional car makers didn't have the means or incentive to overtake Tesla but found that VW did. The Bloomberg report predicts that VW will "double production to more than 2 million battery-powered vehicles in 2024." This will surpass Tesla if it can ramp up production that much. VW is aiming to increase production in Europe, and Bloomberg expects it will do the same in China. The German company's sales in the U.S. totaled less than 10 percent, so it makes sense its goal is to increase in other countries to reach its goal. The report also believes that U.S. and Japanese car brands will be serious competitors for the top three spots later in the decade.
While Tesla has been leading the EV pack for a while, one area where it could fall behind in is electric trucks. The company's Cybertruck is on the way but has had multiple setbacks. It's expected to go into production in 2023, but that's more of an optimistic view. General Motors has jumped into the electric truck business with electric versions of the GMC Hummer and Chevrolet Silverado. Ford dove in with the all-electric F-150 Lightning. So while Tesla has setbacks on its truck, it's getting a lot of competition. The Cybertruck has over three million orders compared to F-150 Lightning's 200,000, but Ford's EV is in production, while the Cybertruck isn't expected to go into production until at least next year.
It was only a matter of time before Tesla faced serious competition. As demand continues to grow, consumers will have more choices, Which is good for drivers. However, Tesla must improve its delays if it wants to compete with legacy brands. Consumers may purchase an EV they can get sooner over waiting long periods for a Tesla. The EV company has also increased prices multiple times as cheaper electric vehicles are coming out, which could also affect its ability to compete. But supply chain issues could prevent all these companies from meeting their goals, at least in the short term.
Source: Bloomberg 1, 2
Volkswagen could overtake Tesla by 2024.Mandy Carr