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Electric vehicle company Tesla Inc (NASDAQ:TSLA) has dominated the market in many places around the world, including the U.S.
A new survey revealed how likely Tesla owners were to stick with the brand when they move on from their old car and what companies they would shift to if they decided to pivot from Tesla.
What Happened: The Model Y vehicle from Tesla has become one of the bestselling vehicles in the world. Tesla continued to increase production and saw strong sales figures each quarter.
Tesla is well-known for its strong loyal fans and customers, a move that helped the company thrive without using traditional advertising methods its automaker rivals use.
Instead, Tesla relied on strong customer loyalty and word-of-mouth advertising.
For these efforts, Tesla won several loyalty awards from S&P Global Mobility in 2022, including the Overall Loyalty to Make.
A new survey from S&P Global highlighted what Tesla owners do when they decide to replace their current vehicle.
According to the survey, 59.9% of Tesla Model S owners buy another Tesla vehicle. Tesla Model 3 owners are even more likely to remain a Tesla customer with 72.8% buying another vehicle from the company.
The survey showed Tesla Model 3 owners are most likely to buy a Tesla Model Y if they stay with the automotive company, with 40.3% choosing the Model Y. Around a quarter of Model 3 owners (26.1%) select another Model 3 as their next vehicle.
“Tesla is very successful at migrating customers from a Model 3 to a Model Y, which contributes to high loyalty rates,” S&P Global Mobility Associate Director of Consulting Services Kent Chiu said. “By putting the Model 3 to market first, followed by the Model Y shortly after, it gave customers a path to migrate through the portfolio.”
The Model Y gets the highest loyalty rate for S&P Global at 37.3%, among electric compact utility vehicles. The Mustang Mach-E from Ford Motor Co (NYSE:F) comes in second at 18.5%.
Related Link: Tesla Q2 Earnings Highlights: Revenue Beat, EPS Beat, Cybertruck Update And More
Moving on From Tesla: Some Tesla owners choose to move on to a different automotive company whether it is for a new electric vehicle or traditional automotive.
One area where Tesla struggles with loyalty is customers moving on to purchase a larger SUV or truck, which is often made with a traditional automotive company.
With the upcoming release of the highly anticipated Cybertruck electric pickup truck, Tesla could see its loyalty increase even more. Tesla customers may choose to stick with the brand with more options across vehicle classes and types.
“The Cybertruck, a second-gen Roadster and a vehicle positioned below the Model 3 all have been promised, and should migrate existing Tesla owners up or perhaps sideways with the brand,” Chiu added.
For Tesla customers who leave after previously owning the Model S, these are the most popular purchases:
Lucid Air from Lucid Group Inc (NASDAQ:LCID)
Rivian R1T from Rivian Automotive Inc (NASDAQ:RIVN)
Mercedes-Benz EQS from Mercedes-Benz ADR (OTC:MBGYY)
Rivian R1S from Rivian
All four of these models are newer than the Model S, which could explain part of the switch with owners looking for a newer more updated luxurious electric vehicle.
The Rivian R1T ranked as the most popular non-Tesla vehicle for Model 3 and Model Y customers who move on to a new vehicle.
“Historically, as a vehicle ages, the loyalty rates decline. And each time there is a facelift, refresh, or redesign, loyalty increases. So the defection to Mercedes-Benz, Porsche and Lucid is consistent with that pattern,” Chiu added.
Read Next: Global EV Market Share Reaches 15% In 2023: Top Players, Vehicles And Companies Dominating Sector
Photo: Courtesy Tesla Inc
