Tesla outsells Mercedes-Benz in the US for first time

tesla outsells mercedes-benz

Tesla Inc just crossed a major milestone in the company’s bid to become one of the world’s biggest automakers: For the first time in the U.S., Tesla sales have surpassed Mercedes-Benz.

According to Business Insider, Tesla sold 69,925 vehicles in the U.S. in the third quarter, while Mercedes-Benz sold 66,542. Even more impressively, Tesla fell just 1,754 vehicles short of surpassing BMW as well, according to Atherton Research.

Calm After the Storm

Passing Mercedes-Benz in sales marks a major accomplishment during a tumultuous time for Tesla and its founder, Elon Musk. Earlier this year, Musk was forced to give up his position as chairman of Tesla’s board of directors for three years and pay a $20 million fine as part of his settlement with the Securities and Exchange Commision. Although Musk did not have to admit or deny any wrongdoing, the settlement was a result of a lawsuit accusing him of making “false or misleading statements” about taking Tesla private.

Shareholders are no doubt relieved that the automaker will remain publicly traded, as the company’s stock has risen by 90 points since the company’s third quarter sales announcement,  closing at 346.41 on Nov. 2.

A big part of Tesla’s recent success is a result of the company’s ramped up production. Tesla said that they delivered 83,500 vehicles worldwide during the quarter that ended in September, 80% more vehicles than the company delivered in all of 2017. Business Insider says that as many as 55,840 of those vehicles were Model 3’s, twice what Tesla had delivered in all previous quarters combined.

Forecast looks good

All of this news has analysts optimistic about Tesla’s long-term future. In October, Macquarie Research announced they have begun coverage of Tesla with an outperform rating, suggesting the company’s shares could balloon up to 70%. As a result of meeting their production targets, Macquarie analyst Maynard Um sees Tesla achieving profitability in the second half of this year. Previously, Musk had promised investors profitability in 2019.

Intriguingly, Macquarie suggested that investors view Tesla as a technology company rather than an auto manufacturer, a perception that Musk has long cultivated. That said, Musk’s eccentric personality and social media proclivities cast a long shadow over Tesla, despite stepping down from the board of directors (he will retain his title of CEO). While acknowledging that Musk will “continue to be a key part of Tesla in the foreseeable future,” Um also wrote that “Musk’s actions and behaviour could adversely impact Tesla’s multiple.”

For now, the company appears comparable to Musk’s SpaceX rocket project: Combustible, certainly, but shooting quickly to the stars.