Tesla Inc (NASDAQ:TSLA) is benefiting from the global increase in oil prices. People in the U.S. are turning away from fossils fuels given the high cost of gas in specific parts of the country, and the company is seeing its electric vehicle (EV) orders surge.
As reported by Electreck, orders for Tesla models in the U.S. have increased by 100% in one week as gas prices are denting the personal finances of millions of people. With crude oil having broken the $100 a barrel barrier, the average gas price at the pump in the country has soared to $4.25 a gallon, with some states hitting $5 a gallon.
U.S. sanctions on Russian oil have triggered a price upsurge, and the skyrocketing gas prices have prompted many to rearrange their budgets and even contemplate the switch to electric cars for good.
“Many of them who are in a position to buy a new car are turning toward electric vehicles. Some out of frustration, others because they are making the cost of ownership calculation and realize that it is actually cheaper than a gas-powered car,” according to Electreck.
The increase in Tesla orders, however, is not bound to affect the automaker’s deliveries as production is still dragging along.
At present, Tesla is the biggest EV manufacturer in the U.S. with an 80% market share. The increase in orders means that Elon Musk’s firm is in a prime position to strengthen its business in the country in comparison to its competitors.
“In the US, Tesla is guiding a July 2022 delivery for new orders of the base Model 3 and September 2022 for the popular Model Y.”
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However, people have more options to turn to, namely competing models such as the Ioniq 5 by Hyundai Motor Co (KRX:005380) and the ID.4 by VOLKSWAGEN GROUP Common Stock (ETR:VOW3) —vehicles whose production is limited and waiting lists are long given the current global situation.
Tesla is part of the Entrepreneur Index, which tracks 60 of the largest publicly traded companies managed by their founders or their founders' families.