Why 2023 is a make or break year for electric vehicles

Elon Musk made history in 2022 by becoming the first person ever to sustain a personal loss of more than $200bn – mainly thanks to a 63% landslide in Tesla’s stock price from its peak.

Shareholders will be hoping that, after his Twitter adventure, “Musk has his sights in 2023 set squarely on consolidating his lead in the fast-growing EV market,” said Richard Waters in the Financial Times. But early omens weren’t promising.

Tesla shares fell by another 3% in premarket trading on Tuesday, after sales growth in its most recent quarter “missed analysts’ expectations”, reported DealBook in The New York Times. After a disastrous year for Musk, the “pressure” is still on.

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Covid lockdowns in China, and knock-on supply chain disruption, haven’t helped, said Martin Strydom in The Times. Neither has the threat of global recession. Tesla is still working on a “generation 3” vehicle that would be “cheaper and smaller” than its Model 3 and Model Y cars, but progress will not be revealed until March.

Meanwhile, a growing roster of new rivals is revving on the sidelines – with challengers stretching way beyond traditional carmakers.

Two of the most potentially disruptive hail from Asia, said Reuters Breakingviews. The giant Taiwanese manufacturer Foxconn (best known for churning out Apple iPhones) is making a “well-timed pivot” into EVs, via US and Thai joint ventures – threatening to become a sector “powerhouse”, producing both parts and cars.

Another racy outfit is VinFast, which made its name selling gas-guzzlers in Vietnam before turning “fully electric”. The company’s boss, Le Thi Thu Thuy, is planning 70 showrooms across North America and Europe in 2023 in a bid to undercut Tesla. “Vietnam is an unlikely home of the next Elon Musk.” But don’t rule Thuy out.