Tesla's decision to slash prices on all its models in the US in January has led to an explosion in sales in the first quarter this year.

The EV maker is on track to surpass a market share of 5 percent for the first time in the United States, according to a forecast from Cox Automotive.

Tesla's US sales in Q1 2023 are expected to top 180,000, which would be a record quarter for the company in the US and would mark a gain of nearly 40 percent from Q1 2022. 

As a result, Tesla will also be the top luxury-vehicle seller in the US this quarter by far, with sales more than double that of BMW or Mercedes-Benz. Combined, the two German luxury brands will sell more than 162,000 vehicles, some 18,000 less than Tesla.

The 5.1-percent US market share would also place Tesla above mass-market automakers such as Mazda, Subaru, and even Volkswagen Group – including Audi, Bentley, Lamborghini, Porsche, and Volkswagen.

The good news for Tesla doesn't end here. Its spectacular sales growth of 39.5 percent year-on-year to 180,993 vehicles is the highest anticipated for brands with sales of over 10,000 vehicles in Q1 2023.

Only Rivian and Lucid top Tesla's growth with 563.8 percent and 192.2 percent, respectively. In the case of the two EV startups, the growth can be explained by the fact they were in the early days of production in Q1 2022 and they are currently ramping up manufacturing.

Tesla is also expected to lead when it comes to market share growth, with Cox anticipating a 1.4-percent rise this quarter to 5.1 percent compared to Q1 2022 when it had a 3.8-percent share. That's the largest growth of any automaker by far, and Tesla is the only brand forecast to increase its market share by more than 1 percent.

Overall, Cox says that while new-vehicle sales will be lower in Q1 2023 than last quarter, they exceeded expectations and are forecast to increase by 5.7 percent year over year. Better inventory levels and higher fleet sales were key drivers of the anticipated Q1 sales growth.

Given the strong start to the year, Cox has increased its full-year new-vehicle sales forecast to 14.2 million, up more than 3 percent from 2022.

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