Many were suspicious when Tesla CEO Elon Musk indicated during the company's Q1 2021 earnings call that he believed the Tesla Model Y would very likely become the world's best-selling automobile in the future. After all, the Tesla Model Y is a luxury electric vehicle, and Tesla's yearly vehicle manufacturing volume remains a fraction of what traditional manufacturers can do consistently.
According to the latest study from the California New Car Dealers Association, Musk may be onto something. According to the CNCDA's data, the Tesla Model Y became the state's second best-selling automobile in 2021, trailing the Toyota Camry by around 1,200 units. This is quite an accomplishment, given that California is the largest vehicle market in the United States.
Tesla Model Y sold 60,394 units in 2021. Its stablemate, the Model 3, performed admirably, with 53,572 units sold during the year. The ubiquitous Toyota Camry led the state's automobile sales in 2021, with 61,599 units sold. As CNBC's Phil LeBeau remarked during a Squawk Box program, the Tesla Model Y's California sales in 2021 were particularly noteworthy given the vehicle's short history in the state.
This means that in the short period since it became available, the Tesla Model Y has surpassed its rivals, even its sister, the Tesla Model 3. The idea that the all-electric crossover got within striking distance of the Toyota Camry is absurd, given that the Model Y is marketed almost exclusively through word of mouth and costs almost twice as much as the ubiquitous family car.
The rate at which the Tesla Model Y is growing is almost alarming, particularly for established automakers who are only now entering the electric vehicle market. However, it is tough to dismiss the all-electric crossover's successes as well, given that the Tesla Model Y arrived at a time when Tesla could no longer claim the federal tax credit. This indicates that the Tesla Model Y's successes thus far have been solely due to the vehicle's qualities. Tesla undoubtedly benefited from this since the business is currently the fifth largest automaker in California.
The Tesla Model Y is the company's most conventional electric vehicle in terms of design and performance. It is not as visually appealing as the Model 3 and Model S, and it is not as fast or as packed with technology as its larger sister, the Tesla Model X. Yet hidden within the vehicle's conservative (at least by Tesla's standards) specifications is an impressive balance — one that makes the Tesla Model Y affordable to the average car buyer while also serving as the ideal electric vehicle to the emerging world of modern electric cars — and that, in and of itself, is a killer combination.
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