Can the electric car acceleration continue? Why 2024 will be the tipping point for Tesla with just Tesla Model 3 and Model Y EVs on sale

No matter which way you look at it, 2023 was a very good year for Tesla. Sales were through the roof as more and more Australians made the switch to electric cars, pushing the American brand into the upper echelons of the sales charts.

Tesla sales are up more than 150 per cent in 2023, with both the Model Y and Model 3 enjoying sustained success this year. They are, by far, the most popular electric vehicles in the country.

But can Tesla maintain this sales pace?

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As the calendar slips to 2024, there are some genuine questions about where the brand is headed and whether or not it can continue to dominate EV sales in the country. There's no question that Tesla's products resonate with Australian customers, the only question is how much longer it can retain such an advantage. So, in many respects, 2024 will be a make or break year for Tesla.

The most obvious issue is the lack of any new product to stimulate sales. Yes, the updated Model 3 has just arrived in showrooms (well, not literally, because Tesla doesn't have showrooms), but it's very much an update of an existing model rather than something completely fresh. Yes, it will help boost sales, but for anyone not paying close attention, it looks similar to the old model.

There's no reports on any similar treatment for the Model Y, although it's much newer than its sedan sibling and therefore still has a degree of freshness and has a better chance to maintain its current sales pace in '24.

Yes, the updated Model 3 has just arrived in showrooms but it’s very much an update of an existing model rather than something completely fresh.

However, in the last two years, Tesla has sold more than 27,000 Model 3s and more than 35,000 Model Ys in Australia, which is a lot and there is an inevitable limit to how many examples you can sell in such a diverse and competitive market.

Which raises the pertinent question - how many more mid-size sedans and SUVs can Tesla sell? How many people in the market for an EV want either a 3 or a Y? After all, Toyota sells a lot of RAV4s and Corollas, but it also sells a lot of Camrys, Klugers, Prados, LandCruisers and HiLux, too.

However, in the last two years, Tesla has sold more than 27,000 Model 3s.

Put simply, Tesla doesn't have enough options to keep everyone happy. As good as the Model 3 and Y are, not everyone wants those types of cars. So maintaining the pace the company has in recent years just seems incredibly difficult.

There's no back-up coming, either. Tesla has spent the past five years focused almost entirely on getting the Cybertruck from concept to production and having only just gone on sale in the USA in the final months of '23, there is no chance it will be on sale in Australia in '24 - if ever.

So how long can the Model 3 and Model Y hold off the increasing diversity of competition?

So how long can the Model 3 and Model Y hold off the increasing diversity of competition? Sure, the likes of Mercedes-Benz, BMW and Hyundai, the established brands, are playing catch-up in the EV race and have struggled to get close to Tesla. Instead, the toughest competition for the market leader is coming from the likes of MG and BYD, the Chinese upstarts that have been able to undercut Tesla on price.

MG is on track to sell more than 3000 MG4 in less than six months on sale, while the BYD Atto 3 continues to rise in popularity.

As good as the Model 3 and Y are, not everyone wants those types of cars.

Next year, BYD will have three all-electric models on sale - Atto 3, Dolphin and Seal - for the full year. That will be our best indicator yet of how well a brand that isn't Tesla is faring in the EV sales race.

In the face of these newer, more affordable rivals, can Tesla maintain its average of nearly 4000 sales per month? For all the questions and doubts, there's reasons for optimism too, so checking Tesla's sales numbers at the end of 2024 will be the only true indicator of the short- to mid-term success of the brand in Australia.