The Vast Majority Of Tesla Owners Buy Another One
Despite concerns that CEO Elon Musk's behavior could damage the brand's image, two out of three Tesla buyers bought another.
- Tesla is leading brand loyalty in the U.S. for the first half of 2024
- The automaker has retained two out of every three buyers
- This is despite CEO Elon Musk voicing controversial opinions previously believed to be doing damage to the brand's image
Despite declining vehicle values and reports that a CEO with controversial political relationships and public opinions has driven away its core customers, Tesla's customer loyalty rate remains the best in the industry.
A new study by S&P Global Mobility reveals that Tesla's brand loyalty rate for the first half of 2024 was 67.8%. Out of all its vehicles, the Model 3 remains the brand's leader with an astonishing loyalty rate of 72.1%—potentially explained by its recent refresh.
For comparison, the industry average brand loyalty rate is 52.5%. S&P says that this rate increased by 1.9% year over year, which is the first year-over-year increase since 2020 and the global COVID-19 pandemic.
2024 Tesla Model 3 (Highland)
The loyalty comes seemingly without question from the majority of Tesla's buyers. Despite crashing resale prices and questionable long-term reliability, buyers are still returning to the brand to purchase their next new EV.
To make matters even more complicated, buyers continue to show brand loyalty despite media outlets like the Wall Street Journal and New York Times reporting that Tesla CEO Elon Musk was alienating its typical buying demographic with controversial geopolitical takes. For example, commenting on immigration, denouncing gender pronouns, attacking advertisers who abandoned his social media platform, and much more. Owners have also claimed that they are embarrassed to drive a Tesla. There's even a bumper sticker that you can buy on Amazon to warn other drivers that you don't subscribe to Musk's views.
It's worth noting that Tesla's brand loyalty actually decreased year-over-year—potentially explained by more competition in the EV space. However, as Forbes explored, the decrease was less than 1%. Despite this, Tesla has a "healthy margin" ahead of its competition.
"Tesla has historically been a brand with strong loyal ties among their consumer base, despite a limited product portfolio," said S&P Global Mobility associate director Vince Palomarez. "Changes in BEV prioritization among other OEMs, along with Tesla's directive to cut pricing when needed, has kept households from defecting."
It will be interesting to see how long Tesla keeps this title. The brand receives a lot of flack for failing to update its lineup with new models, though owners are often pleased with over-the-air updates that bring new software-based features to their cars.
That being said, with more competition coming to the electric auto space—especially more affordable models debuting in 2025 and beyond—Tesla could soon see customers flock to other automakers that provide vehicles with similar specs and a NACS charging port with access to the Tesla SuperCharging network. Or, it could surprise the world and retain the support of owners. Only time will tell.
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