ByDouglas McIntyre • April 10, 2024
Customer loyalty is extremely important in the car industry. When one car company takes a customer from another, it is termed a “conquest.” Most car brands have a retention rate of about 65%. A new study shows that for Tesla, the number is much higher, at 87%.
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The 87% number is particularly important as EV sales slow in the US. Market share becomes critical when a market’s expansion has slowed. Tesla has little competition in the EV segment. The high retention rate means it is not losing share to companies like Ford, GM, Kia, and Hyundai.
The Tesla news is terrible for other manufacturers, notably Ford. Ford’s EV launches were supposed to be overwhelmingly successful because they relied on names plates that are among the best-known brands in the industry–F-150 Lighting and Mustang Mach-E. The F-150 has been the best-selling vehicle in the US for 42 years, and the Mustang, launched in 1964, is among history’s most iconic sports brands.
Electek reports, “Tesla maintains an 87% brand retention rate, with Lexus (68%) and Toyota (54%) trailing, according to a new Bloomberg Intelligence survey. Moreover, 81% of prospective US Tesla drivers are new customers switching from competing EV brands.” The original data comes from Bloomberg Intelligence.
