According to data shared with Reuters by market researcher JATO, the Tesla Model Y was the world's best-selling vehicle in Q1 of 2023, surpassing more traditional best-sellers. Unsurprisingly, the report also shows that China saw the most number of sales for the electric crossover.

Elon Musk predicted this exact outcome last year despite our heaviest doubts.

Out of the 267,171 Model Y units sold in the first three months, 94,469 were sold in China, outdoing the figures in the US (83,664) and Europe (71,114). The US is still the company's largest and most important market despite Tesla holding back from disclosing regional sales breakdowns.

The Model Y also achieved a significant milestone in Europe, where it became the best-selling vehicle in Q1. Over half of its total Q1 sales in the Old Continent were sold in March, according to market researcher Dataforce.

The report indicates that the Model Y has upended the Toyota Corolla, Hilux, RAV4, and Camry in the global sales chart, though these Japanese cars follow close behind. Notably, the Model Y was the only fully electric car on the top sales list.

Musk remains bearish of the report as he expressed concerns over growing tensions between China and the US. Emphasizing the importance of China as the largest electric car market globally, the Tesla CEO recently visited the country for the first time in three years. The company has also engaged in discussions with Indian officials regarding the construction of a new factory in India.

JATO Senior Analyst Felipe Munoz predicts that the Model Y will retain its position as the world's best-selling vehicle by the end of 2023. He attributes this to price reductions, allowing the premium midsize SUV to benefit further from regulatory government incentives. The prospect of rising demand for electric vehicles in developed economies is expected to boost Model Y sales even further despite fierce competition.

However, Barclays analyst Dan Levy raises concerns about Tesla's heavy reliance on just two models, the Model Y and the Model 3. Levy suggests that Tesla may need to introduce additional models and variants to expand its market. Ford CEO Jim Farley also highlights intense competition in the SUV segment, where Tesla's aging Model Y faces a growing number of newer rivals.