Tesla slump and falling prices set to change EV market

Daftar Isi

A global upheaval in the electric vehicle market, with a downturn in Tesla sales and policy changes in several countries, could have a positive impact on Aussie motorists, potentially resulting in a sharp decline in prices.

Aussies can expect electric cars to break the $20,000 barrier this year, and to see a bigger range of battery-powered vehicles, including more electric utes and vans.

Every company's global head of electric vehicles, Dan Caesar, made the forecasts on Monday, just a month out from launching their third electric vehicle exhibition in Australia and into what he said will be a defining year for the country.

His forecasts come after Australia posted a notable decrease in sales for new electric cars in January, in sharp contrast to a year of steady growth.

Electric vehicle sales are also expected to shift in other regions, such as the United States, where President Donald Trump removed a 2030 EV sales target and threatened to impose tariffs on electric vehicles imported from Canada and Europe.

While the changes may hinder sales in the US, Mr Caesar said they could prompt more automotive brands to bring electric vehicles to Australia at lower prices.

Chinese brands, locked out of the US market due to a 100% tariff introduced in 2024, were already increasing competition and reducing prices in the market.

We're seeing Chinese brands that have incredible technology, but there is a trade-off – they're new to the market, so to get people to have faith in them, they might need to tone down their prices a bit.

Electric vehicles revealed at the show will feature a model from a Chinese brand priced roughly $20,000, he mentioned, which will smash a record in Australia – till now, the cheapest EVs have yet to dip below $30,000.

Competition among electric vehicle brands could also be intensified by the global decline in Tesla sales, he said, which has had a stranglehold on the industry for several years.

Tesla's sales in Australia have decreased by over a third, with other nations experiencing even steeper declines, such as Spain where sales plummeted by 75 per cent.

While the slump is bad news for the trailblazer, Mr Caesar reckons it could be an opportunity for both new and established brands to find an audience.

"My reading of the data suggests that Tesla's perception issue is linked to Elon Musk, but I'd be keen to see how that plays out over the next couple of months," he said.

Tesla's got a die-hard fan base and they have an exceptionally high rate of repeat business, so if some of those loyal customers are shopping around for a new brand, that's a massive pool of potential customers.

Up to six new electric vehicle models will be unveiled at the motor show at Sydney Showground on March 7 and 9, showcasing e-utes, vans, motorbikes, and boats, along with around 7500 test drives available.

More than 240,000 electric vehicles have been sold in Australia since 2011, says the Electric Vehicle Council, with battery-powered cars making up only 4.4 per cent of new car sales last month.