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Can Volkswagen outcompete Tesla and take the EV market?

German automaker Volkswagen (VW) sold 422,000 vehicles in Q4 2020 alone, representing a 13% market share, VW actually sold the most electric vehicles (191,000), compared to Tesla’s 183,000.

It’s possible that Tesla’s time at the top of the electric vehicle (EV) pack is coming to an end. The American sustainable energy firm sold slightly under 500,000 EVs in 2018, garnering a 16% market share worldwide, down from 17% in 2019.

Tesla had a 23% global market share for sales of all-electric vehicles in 2020, more than double VW’s 11% ranking, however, the latter is coming up to the former in the global EV industry.

Key observers claim that the German manufacturer is still lagging behind Elon Musk’s business in some crucial areas, like software, but VW has an advantage in terms of expertise ramping up to mass manufacturing.

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Herbert Diess, the CEO of the Volkswagen Group, made his Twitter debut in January with a playful jab at Tesla’s Elon Musk, claiming that the German automaker was out to steal market share from Tesla after having already dominated the first markets in Europe. The tweet, if anything, simply expressed VW’s aim to unseat Tesla from its throne as the largest electric carmaker in the world and to maintain its position as a leading force in a sector that is undergoing rapid change.


Volkswagen has been investing tens of billions of dollars as part of a significant strategy shift toward electric vehicles (EV). By 2030, the group’s name-brand company anticipates that sales of all-electric cars will make up two-thirds of its total vehicle sales in Europe and more than half in China and the US. The aggressive EV attack has put the 83-year-old business firmly on course to surpass electric vehicle market leader Tesla within the following two years.

Last year, the group’s sales of pure-electric vehicles more than tripled to nearly 230,000, reducing the gap with Tesla, which shipped just under 500,000 units.

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Volkswagen EV Market details

Volkswagen surpassed Tesla to become the largest manufacturer of electric vehicles in Europe, selling one in every four finished vehicles in a year that saw EV sales soar. Supported by generous European state subsidies and stringent CO2 emission standards, which encouraged carmakers to continue producing EVs despite losing money on sales, EV sales soared.

Given VW’s rapid EV rollout plans, some analysts even believe there is a 100% chance the automaker will surpass Tesla in the upcoming year or perhaps this year. In 2021, the ID.4 SUV and the ID.5 crossover will arrive in stores after the ID.3 hatchback, which made its debut in Europe last year. Later this year, the seven-seater ID.6 X is expected to start selling in China.

Additionally, Volkswagen intends to install 3,500 charging stations in the US and 17,000 in China. However, several analysts warned that VW is still far behind Tesla in terms of its software and battery capabilities, noting that VW presently costs more for batteries per car than Tesla ($1,300), and that “this gap is unlikely to be reduced given to Tesla’s vertical integration and inventive power.” According to UBS analysts, this region will serve as the future “battleground” for EV supremacy. Volkswagen is also going to spend US$19 billion over the next five years improving its software and digitalization.


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