Tesla Model 3's Interesting Impact on BMW Sales
The Tesla Model 3 has had a segment-changing effect on sales. One might assume that the incredibly-high sales that Tesla has posted with its Model 3 in America would be devastating to the brand and model that defined that segment prior to Tesla's Model 3 arrival. The impact is significant, but a look at some data reveals some interesting facts. Starting with the fact that BMW's sales are higher today than at the time of the Model 3's arrival.
BMW 3 Series Sales History
The chart at the top of our page shows the change in monthly sales of the BMW 3 Series sedan line in America. Note that the X-axis (bottom) is time-stamped by September sales of each year indicted. In other words, the "2015" indicates the sales level of the 3 Series in September of 2015. The Y-axis ( the vertical axis) shows the number of BMW vehicles sold in September of the year indicated.
BMW Sales Prior To Tesla Model 3
As you can see, BMW's 3 Series sales were slowing prior to the arrival of the Tesla Model 3. In fact, they had dropped by a monthly rate of roughly nine thousand per month (in September) to roughly 6,000 per month (in September) from 2015 to 2017. The Model 3 arrived in July of 2017, but only in tiny numbers.
By September of 2018, one year ago, BMW's sales of the 3 Series sedan had declined by half again to 3,615 units. This was the peak period of Tesla's Model 3 sales in America. Interestingly, the BMW 3 Series sedan has increased in sales of September of this year. Rising up to 4,303 units of the 3 Series sedans sold in September, this past month.
Observations on BMW 3 Series Sedan Sales Might Include:
- BMW's 3 Series sedan sales were slowing rapidly before the Model 3 arrived in mid-2017.
- BMW's 3 Series sedans sales continued to slow as the Model 3 ramped up.
- BMW's 3 Series sales have stabilized and were up by 15% September 2019 vs. September 2018.
Tesla Impact On Markets
It is easy for one to assume that a new successful model entering into an established market segment will result in a one-for-one loss of sales by a major competitor. However, that is usually not the case, particularly in the automotive world. Rather, the new entrant dilutes the sales of the top seller by a major degree, but the existing model can sustain healthy sales despite the new model. Here, the 3 Series has retained decent sales. Particularly when one considers that the overall trend is a reduction in sedan sales.
BMW Overall Sales Trend
The really interesting part of the story is overall sales at BMW. One might assume since the 3 Series had defined the BMW brand at one time in the past, that any meaningful reduction in sales of the 3 Series would result in a lowering of sales at BMW. But that has not happened. In fact, BMW's year to date sales overall have grown over the years since 2015. BMW's sales to date in September of 2019 (27,467) are up 6% over sales to date in 2018 (25,908). They are also up from 2017 (25,571), 2016 (25,389), and 2015 (26,608). Please note again that these are not BMW year-end sales, but YTD September sales.
Tesla's Impact on BMW Sales - Conclusions
So, in conclusion, Tesla's Model 3 has resulted in a meaningful reduction in sales of the BMW 3 Series sedan. However, the 3 Series remains a top-seller in the segment (number two by our count), and its sales have stabilized. Perhaps more importantly, the BMW brand overall is healthy and it is hard to see any reduction in sales overall at BMW since the Model 3 arrived. In fact, the opposite is true. Since Tesla's Model 3 arrived in July of 2017, BMW's sales have increased meaningfully. Perhaps credit for that goes to BMW's product planners who were wise enough to see signs that crossovers were the future preference of shoppers in the premium/performance segment.
BMW's X3 is now the brand's top-selling model by a wide margin. We'd like to ask our readers what impact they think the new Model Y crossover from Tesla will have on BMW's sales when it arrives. Let us know in the comments below.
Note: MINI brand sales have been excluded from this analysis.
In addition to covering green vehicle topics, John Goreham covers safety, technology, and new vehicle news at Torque News. You can follow John on Twitter at @johngoreham.