China was top market for Tesla Model Y, world’s best-selling car in Q1

By Hyunjoo Jin and Akash Sriram

SAN FRANCISCO (Reuters) – China was the biggest market for Tesla (NASDAQ:)’s Model Y electric sport utility vehicles, helping it become the world’s top selling vehicle in the first quarter of this year, according to data from market research firm JATO shared with Reuters.

Elon Musk on Tuesday visited China for the first time in three years, highlighting the importance of the world’s biggest electric market.

Tesla sold 267,171 Model Ys in the first quarter of this year, of which 94,469 were sold in China, higher than 83,664 in the United States and 71,114 in Europe, according the data. Overall, the United States was the biggest market for Tesla, which does not provide regional breakdown of its global sales.

Model Y ranked first in global sales, followed by the Toyota Corolla, Toyota Hilux, Toyota Rav4 and Toyota Camry, according to the data. Model Y is the only pure electric car in the list.

Musk recently told CNBC that growing tensions between China and the United States “should be a concern for everyone.” Tesla also recently held talks with Indian officials about building a new factory in India.

JATO Senior Analyst Felipe Munoz expects the Model Y will be the world’s top-seller by the year-end in 2023 because of price cuts that enable the model to access the benefits of public incentives for EVs.

More production from Tesla’s new plants in Texas and Berlin and easing supply chain issues, as well as increasing EV demand in the developed economies, should also buoy Model Y sales, he said.

Unlike many automakers, Tesla has a limited number of models and their variants, which helped the Model Y become the biggest seller.

Barclays (LON:) analyst Dan Levy said there are concerns about Tesla being too reliant on just two models, Model Y and Model 3, adding Tesla may need more models and variants to expand its market.

Tesla this year aggressively cut prices, underscoring intense competition especially in the SUV segment, where Tesla’s aging Model Y faces a range of newer rivals, according to Ford CEO Jim Farley.