As the CEO of Tesla, Elon Musk has set ambitious goals for the company including selling 20 million cars by 2030 and increasing the company’s worth to trillions of dollars. However, in order to maintain a strong presence in the automotive industry, experts suggest that Tesla should expand its product lineup and offer more affordable options. Despite only having a four vehicle lineup of high-end models, Tesla has made significant progress in the industry, becoming the top seller of battery-powered cars globally with 1.3 million units shipped in 2022, and the Model 3, Model Y, Model S, and Model X, accounting for roughly 65% of electric vehicles sold in the US. To sustain its leadership in the industry, Tesla must consider expanding its product offerings to reach a wider audience and increase accessibility to its technology.
Experts in the automotive industry predict that Tesla’s rapid growth may reach a limit if the company does not offer more affordable and widely accessible options to consumers. This is in line with traditional business strategies employed by major players in the industry, such as offering a diverse range of products to appeal to a wide range of customers. Companies like Toyota, for example, have a broad range of offerings, from the $22,000 Corolla to the $100,000 Lexus LC, and many options in between. Similarly, Volkswagen sells budget-friendly hatchbacks as well as luxury vehicles like Porsches, Audis and Bentleys. General Motors also offers a range of cars including Chevrolet and Cadillac. In order to sustain its growth trajectory and maintain a leading position in the industry, Tesla must consider expanding its product offerings to appeal to a wider range of consumers and meet their varying needs and preferences.
With a limited number of lower-cost options in its product lineup, Tesla faces increasing competition from other electric vehicle manufacturers. China’s BYD, for instance, is rapidly closing in on Tesla’s leading position in the global EV market. This is not surprising, as BYD has a diverse range of vehicles and Tesla primarily focuses on luxury models, according to Michael Dunne, founder of the EV consultancy ZoZoGo. The lack of more affordable options in Tesla’s lineup leaves the company vulnerable to competition from other manufacturers with a broader range of products catering to different markets and price points.