German Electric Vehicle Makers Poised to Outpace Tesla by 2021, Study Finds
A recent study reveals that German automotive giants are set to surpass Tesla in the electric vehicle market by 2021.
Competition in the electric vehicle (EV) industry is intensifying rapidly, and Tesla Inc. (TSLA), the current market leader, may soon face serious challenges to maintain its dominance. According to a forecast by PA Consulting Group, leading German automakers such as Daimler AG, BMW AG, and Volkswagen AG are predicted to overtake Tesla by 2021, Bloomberg reports. (See also: Who Are Tesla's Main Competitors?)
The consulting firm evaluated global EV manufacturers using multiple criteria, including battery technology, business strategies, supplier networks, strategic partnerships, corporate culture, and financial performance. This comprehensive approach generated an overall score to rank electric vehicle producers over the coming years.
The latest rankings suggest Tesla will hold the top position through 2019. However, by 2021, Tesla is expected to drop to seventh place, with Daimler projected to claim the number one spot.
Tesla Faces Growing Competition in an Expanding EV Market
In 2019, the rankings feature the Renault–Nissan–Mitsubishi Alliance in second place, followed by BMW, Hyundai/Kia (Hyundai Motor Group), Daimler, Volvo, and Volkswagen at seventh. By 2021, BMW is anticipated to rise to second place, followed by the Renault–Nissan–Mitsubishi Alliance, Volkswagen, Volvo, and newcomer Toyota at sixth. Notably, Hyundai/Kia is expected to fall out of the top seven by 2021.
While BMW, Volvo, Volkswagen, and the Renault–Nissan–Mitsubishi Alliance are projected to maintain relatively stable positions between 2019 and 2021, Tesla’s ranking is expected to decline significantly.
As global automakers ramp up investments in sustainable electric vehicle initiatives, the market will become flooded with diverse models. Tesla, which currently enjoys near-monopoly status in the EV sector, will face stiff competition from a broad array of offerings by established manufacturers. German companies, renowned for their automotive expertise, stand to gain from supportive government policies. Recently, German Chancellor Angela Merkel and Chinese Premier Li Keqiang signed an agreement to establish a Chinese CATL battery factory in Erfurt, Germany, further strengthening the region’s EV ecosystem. The study also considered Tesla’s reported production challenges with its Model 3 in Palo Alto, California. (See also: How Tesla Could Lose the Electric Car Race?)
“Meeting CO2 emissions targets and enhancing electric mobility performance go hand in hand,” stated Thomas Göttle, head of PA Consulting’s automotive division. “However, manufacturers must also address significant organizational and personnel challenges to succeed.” (See also: How Big Automakers Will Speed Past Tesla?)
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