The long-awaited shift to electric cars has seen some significant developments this week:
- Volvo, owned by China’s Geely, announced it’s only going to launch electric or hybrid models after 2019.
- France declared that it’s banning the sale of gas and diesel cars by 2040.
- Tesla, Elon Musk’s pioneering luxury electric car company, said it’s rolling out its first mass-market car this month.
Electric cars still account for only a small percentage of the U.S. market. And Tesla is the biggest seller, despite its cars’ high prices. Tesla sold the most electric vehicles in the U.S. of any car company last year — nearly 50,000, or a third of all plug-in electric and plug-in hybrid electric vehicles in the U.S., according to data from Hybridcars.com.
With the launch of Tesla’s Model 3, starting at a relatively affordable $35,000, these sales will surely grow. Tesla plans to drastically ramp up deliveries to an ambitious 500,000 globally next year, up from 76,000 in 2016.
The big question now is: As electric car sales accelerate, will Tesla maintain its lead? It has brand advantage and also a lot of data on its users, which is crucial for self-driving operations. But the rest of the auto industry is moving quickly to electric cars and it has proven production capacity — unlike Tesla — and wide distribution networks. Is Tesla making the iPhone of electric cars, or the PalmPilot?
New forecasts from Bloomberg New Energy Finance predict that Tesla will maintain its U.S. lead compared to other competitors. While GM currently has the highest number of cumulative electric vehicle sales in the U.S., BNEF expects that Tesla will surpass it next year and will deliver a cumulative 709,000 vehicles in the U.S. by 2021 — far outpacing other car companies.
Of course, for this to happen, Tesla will have to make good on its production promises.