Continued from page 25 Covering Second Quarter 2022 Page 5 4.4 17.4 19.1 23.0 29.8 36.8 2017 2018 2019 2020 2021 YTD '22 Years REVIEW OF FIRST HALF RESULTS January thru June 2022 Registrations Fall Below 7 Year Average San Diego County New Retail Light Vehicle Registrations January thru June, 2016 thru 2022 Two outliers stand out on the graph: the first half of 2020 (when the pandemic started) and the first half of this year when supply constraints held back sales. Registrations in the first half of this year exceeded the pandemic lows of 2020, but declined by 13% versus the average total from 2016 thru 2019. Last year’s total exceeded 75,000 units, higher than 2018 and 2019, as demand recovered from the pandemic and supplies were sufficient. Optimistic: Tesla can continue to make gains Tesla has a head start in the electric vehicle market. When many consumers think of BEVs, they think of Tesla. Cybertruck is reportedly being introduced in 2023. The radically styled pickup could provide a boost to Tesla sales Some believe Tesla has a competitive advantage in battery production and technology. Pessimistic: Tesla market share has reached its peak It’s gospel in the industry: new product increases sales. Cyclical model redesigns are key for brands to maintain or grow market share. Tesla has never had a significant redesign and based on typical industry standards, some models are getting stale. Tesla regularly ranks below average in most measures of vehicle quality and dependability. With a steady stream of new BEVs scheduled to hit the market, this could be a competitive disadvantage for Tesla. Tesla is reportedly incurring significant losses related to the opening of new production facilities. Is this a “one-off” cost that will go away when the plants are up and running? Or does it foretell future profitability challenges? KEY FACTS LUXURY CLOSE UP Tesla’s Dramatic Rise...and Fall??? Tesla Percent Share of County Luxury Market 2017 thru 2021, 2022 thru June The graph above shows Tesla’s percent share of the San Diego County luxury vehicle market from 2017 thru 2021, and the first half of this year. Tesla share increased from just 4.4% in 2017 to 36.8% during the first six months of this year. Tesla was the best-selling luxury brand so far this year, well ahead of BMW (14.0% share) and Mercedes (13.2%). Source: AutoCount data from Experian. What’s ahead for Tesla? Tesla market share was up 32.4 points between 2017 and 2022. 78,454 77,895 72,662 69,048 55,677 75,263 65,040 1st half 2016 1st half 2017 1st half 2018 1st half 2019 1st half 2020 1st half 2021 1st half 2022 26 San Diego Dealer
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