Tesla's Model 3 was the best-selling luxury car of 2018

Tesla's new Model 3 car on display is seen on Friday, January 26, 2018, at the Tesla store in Washington, D.C.
Salwan Georges | The Washington Post | Getty Images

Tesla navigated a bumpy road in 2018 — a year that saw CEO Elon Musk step down as chairman as part of an SEC settlement over fraud charges, while the electric automaker also faced criticism over working conditions and production delays.

But, the past year also had good news for Tesla. The company sold nearly as many of its vehicles in 2018 (over 245,000 of them) than it did in every previous year combined, going back to its 2003 founding, Tesla said in a press release at the start of January. Helping to drive that growth was the fact that Tesla's Model 3 sedan became the best-selling luxury vehicle on the US market.

Last year, in total, Tesla sold 145,846 Model 3s, the company's mid-size, four-door sedan that started production in 2017. That easily outpaced the 111,641 units sold by the Model 3's closest luxury vehicle competitor, the Lexus RX.

That Lexus luxury SUV (which is made by Toyota) finished 2018 second on the list of best-selling luxury vehicles, followed by more luxury SUVs like the Mercedes-Benz GLC (an estimated 62,435 units sold) and the Audi Q5 (61,835 units), according to Kelley Blue Book.

The Model 3 vaulted to the top of the list of best-selling luxury vehicles this fall, after Tesla said it sold over 55,000 units of the luxury sedan in 2018's third quarter. That number kept growing in the fourth quarter, with Tesla selling over 63,000 Model 3s in the year's final three months.

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Of course, the irony of the Model 3's success in the luxury market is that the vehicle was intended to be Tesla's first-ever mass market automobile — a less expensive alternative to Tesla's pricier vehicles that could reach a wider market of drivers. Other than the Model 3, Tesla's cheapest vehicle is the Model S full-sized sedan, which starts at nearly $80,000.

While the Model 3 is supposed to start at $35,000, that price is only available on the version of the car that comes with a "standard" battery, which Tesla won't start selling until at least February. The Model 3s currently available feature longer-range batteries and a starting price of at least $45,000.

Tesla is currently rolling out more than 4,700 Model 3s per week, which is more than double the company's output during a period in early 2018, when Tesla experienced numerous production delays on the Model 3. However, that's also still below Musk's own oft-stated goal of 5,000 Model 3s per week (which Tesla did, briefly, hit over the summer).

Meanwhile, despite strong sales numbers from the Model 3, Tesla is already off to an up-and-down start to 2019. Wall Street was initially disappointed by Tesla's reported fourth-quarter financials, as even Tesla's record overall sales numbers ended up coming in just short of what analysts were predicting for the fourth quarter. Tesla's stock price dipped 9.7 percent in the first two days of trading in 2019 before rebounding over the past few days (it's now up less than one percent on the year).

Correction: This article has been updated to show that Tesla sold nearly as many vehicles in 2018 as the company sold in all of its previous years of operation combined.

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