Tesla's market share in the US has climbed up to 4.2%
ICannot_Enough / X
Tesla not only continued to dominate the EV segment but also made significant inroads into the overall automotive market in the United States, surpassing established players like Volkswagen. According to Cox Automotive and Kelley Blue Book, Tesla's market share in the US automotive sector climbed to 4.2% in 2023, up from 3.8% in 2022. This increase was bolstered by an impressive 25.4% jump in sales, with Tesla selling approximately 654,888 vehicles in the US.
While the numbers are impressive, they don’t show how Tesla has pulled this feat off. No car company worldwide is under more mainstream media scrutiny than Telsa. The company does little advertising, and despite committing to try marketing its product more traditionally, Tesla still strives on word of mouth. Its CEO, Elon Musk, is a lightning rod for controversy. Musk is under a continuous attack that has caused some shareholders to be concerned in the past. Despite all of that, Tesla is on the rise.
Comparison with Traditional Automakers
Data from Cox Automotive and Kelley Blue Book reveals a remarkable upswing in Tesla's market share in the US. Climbing from 3.8% in 2022 to 4.2% in 2023, Tesla's growth trajectory reflects a robust 25.4% increase in sales, translating to about 654,888 vehicles sold in the US.
While Tesla's market share is still behind giants such as GM, Ford, and Toyota, its growth trajectory is notable. In 2023, Tesla's market share exceeded that of Volkswagen (4.1%), Subaru (4.1%), and BMW (2.5%). This achievement is significant, considering Tesla exclusively sells EVs, unlike Volkswagen and others that offer mostly internal combustion engines. However, Tesla's rise in sales came with a reduction in profitability, as the average transaction price for its cars dropped from around $60,000 to just over $50,000 by the year's end.
The Changing EV Landscape
The EV sector is poised for a significant transformation, with over 70 new EV models expected to debut in the next two years. This influx of new models will intensify competition, challenging Tesla's current market dominance. However, Tesla is not resting on its laurels, with the introduction of the Cybertruck and updates to popular models like the Model 3 (now available in North America) and the Model Y anticipated to stimulate further growth.
Tesla's innovative approach and strong brand recognition position it well to navigate the increasingly competitive EV market. The company's ability to adapt to market demands and its commitment to technological advancements are key factors that will likely sustain its growth trajectory.
Market Dynamics and Tesla's Strategy
The automotive market in the US is expected to experience an uptick in sales, with new vehicle sales projected to reach 15.7 million in 2024. Tesla's strategy seems well-aligned with these market dynamics, as evidenced by its expanding product line, like the “Model 2” and strategic pricing adjustments.
Tesla has the largest growth over the last eight years
ICannot_Enough / X
Tesla's remarkable performance in 2023 signifies a major shift in the automotive industry, highlighting the growing appeal of EVs and Tesla's capability to leverage this trend. Despite facing challenges from a rapidly evolving market and increased competition, Tesla's innovative strategies and strong market presence have established it as a formidable player in the automotive sector. The company's journey from a niche EV manufacturer to a key competitor against established automotive giants like Volkswagen is proof of its resilience and adaptability.
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Tesla has begun reaching out to customers to replace the high-voltage battery pack seals in Model S and Model X vehicles manufactured between 2021 and 2022. In particular, this impacts vehicles between January 2021 and September 22, 2022.
Tesla is notifying impacted owners through a notification and message in the Tesla app.
Plunger Replacement
The high-voltage battery port plungers intended for internal water leak egress (also known as flood ports) are being replaced with improved parts. The new parts are designed to be more robust against external water ingress due to submersion during flooding or other high-severity water impacts.
Tesla specifically notes that no action is needed from owners at this time - once the parts are available, owners will be notified with a notification from the app to encourage them to schedule a service appointment.
This voluntary recall is likely related to the incident where the fully submerged Model X caught on fire underwater, requiring first responders to wait for the battery to burn out before recovering the vehicle. That incident occurred back in October 2023.
While Submarine Mode is a fun Easter Egg, it doesn’t actually improve your vehicle’s water rating.
Service Details
Taking a look at the Service Bulletin (SB-25-16-002), Tesla will be replacing all five flood ports and, if necessary, the breather plugs and flood port doors. Tesla will require you to take your vehicle in for this appointment, which should take approximately 90 minutes for the Model S, and approximately 60 minutes for the Model X. Tesla’s Mobile Rangers won’t be able to complete this activity in your driveway.
The part being replaced is the plug.
Not a Tesla App
Because this is a voluntary recall, Tesla will be offering this as a goodwill service for any owners who have exceeded their Model S or Model X limited battery warranty - so don’t hesitate to take your vehicle in.
Following a period of radio silence from Tesla on FSD updates, Elon Musk has finally hinted that progress is continuing behind the scenes on FSD and that “Several major improvements are incoming.” We’re pretty excited - it has been over 100 days since the last FSD update, and we haven’t heard much since then.
The latest versions of FSD were V13.2.8 for AI4 vehicles and V12.6.2 for HW3 vehicles, both of which were released in January of this year — almost four months ago. While development has been ongoing internally, many have been wondering what the next public release will be. Will it be FSD V13.3, or will we jump straight to FSD V14.
Decoupled Releases & Spring Update
Tesla has now begun pushing Early Access users the 2025 Spring Update without an FSD version change. This means that we can expect the next FSD update to likely be based on the 2025.14 branch.
It’s worth noting that Tesla can add improvements to FSD at any time - and sometimes they do make minor changes without incrementing release numbers - small flag changes in FSD’s software to address how it does a specific task, or what data is uploaded.
With all that said, we expect the Spring Update to begin going out to more of the fleet in the coming days. We’re currently seeing about 58% of the fleet on the Spring Update, and only 30% of the fleet on the older 2025.8 January Update.
Not A Tesla App received information that an upcoming update was set to bring features from other AI4 vehicles to the Cybertruck, including Start FSD from Park, Unpark, Actually Smart Summon, and more. This update was intended to bring it closer to feature parity with the rest of Tesla’s AI4 fleet, but for now, Cybertruck remains the redheaded stepchild of the fleet.
We’re still confident that Tesla is working on this, and the continued delays on the release of an FSD update could point to the Cybertruck and a lack of data continuing to be a pain point for Tesla’s AI team. Cybertruck owners, including the author, have noted that FSD-equipped Cybertrucks continue to upload several hundred gigabytes or more of data per month. This topped out at nearly 1.9 TB of data uploaded in April 2025 for the author.
That’s a massive amount of data - and other users on social media have mentioned much the same for their own Cybertrucks. Tesla needs as much data as possible to tune the FSD models, and given the small fleet size for the Cybertruck, it requires a vast amount of data per user.
“Major Improvements”
While Elon didn’t mention what constitutes these major improvements, we have a lot of expectations besides what we know about the Cybertruck. Learning from the recent and successful FSD launch in China, Tesla is now able to utilize a more generalized model without specific local training data. This could potentially translate into better performance in North America as well, as the 7.7 million miles globally driven on FSD every day are feeding back into Tesla’s data loop.
We’re hopeful that future improvements continue to focus on improving tracking and decision-making, as well as lane handling. FSD users on X continue to point out issues with lane selection and lane keeping in the latest versions of FSD. On the flipside, Tesla has greatly increased the comfort and smoothness of FSD - and V13 is a prime example of that.
While V13.2.8 is also capable of pulling into parking stalls both forwards and in reverse (thanks to one of those flag changes recently), it does an oddly poor job of parking. Tesla’s Vision Autopark, on the other hand, is exceptionally accurate, even with big vehicles like the Cybertruck. It feels like Tesla is working on the parking lot stack to prepare for the upcoming launch of Robotaxi in June.
What About FSD V14
Back in the Q4 2024 Earnings Call, we heard about FSD V14, and just learned a little bit of what will make it unique. In this case, it's auto-regressive transformers that will improve FSD’s already powerful perception system and help it to predict better how other vehicles and road users will behave around it.
That, alongside a larger model and increased context size, will help FSD manage edge cases and make better decisions. The larger model and context size increases are likely another challenge for Tesla, which is already pushing the hardware limits of AI4 with FSD V13.
We did a deep dive into what we know about V14, which you can read here.
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