Tesla Inc. (NASDAQ: TSLA), an electric car maker founded a century after Ford started putting Model Ts on America’s roads, rose the most in brand value in BrandZ’s 2017 Car Top 10 that was released today.
Tesla, run by entrepreneur Elon Musk, posted a gain of 32% from the same period a year ago and was by far the biggest gainer in the annual listing of valuable car brands in the 2017 BrandZ Top 100 Most Valuable Global Brands ranking released by WPP and Kantar Millward Brown.
Toyota Motor Corp. (NYSE: TM) retained its number one ranking for the 10th time in 12 years, according to BrandZ, and has a brand value of $28.7 billion. Toyota’s brand value decreased 3% as increased sales were offset by tough currency challenges, as well as increased investment and rising labor costs, according to BrandZ.
Tesla, which joined the BrandZ Cars Top 10 for the first time last year, outscored both industry and mass brands on brand purpose, innovation and being creative. Tesla’s impact on the automotive industry underscored by the fact the California-based electric carmaker recently overtook Ford and GM in market value.
Tesla introduced its vehicle without a dealer network, placing them in high-end malls and other high-traffic locations, while most other car brands still rely on dealerships. Tesla is worth $5.9 billion in brand value.
Land Rover, the standard for off-road vehicles, followed Tesla in percentage of value increase, climbing 17%. Only two other brands on the list rose in value. Porsche increased by 16%, and Mercedes-Benz rose by 4%, outselling BMW for the first time in a decade as BMW’s U.S. sales slowed, according to BrandZ.
Luxury car brands are gaining more traction among consumers. BrandZ said luxury brands comprise over half the brands in the ranking on 2017, compared with just over a third in 2006.
The value of the BrandZ Car Top 10 overall was flat, compared with a 3% decline a year ago. Sales increased globally while margins remained thin.
Car sales in China, the world’s biggest auto market, shifted into a higher gear, rising to another record year, with 22 million cars sold. The United States also reached a record, selling 17.6 million light vehicles. Sales rose for the third consecutive year in Continental Europe, and U.K. sales reached a record of 2.7 million cars, BrandZ said.
Carmakers invested in the development of electric and autonomous cars, as well as in connectivity to integrate cars into the Internet of Things.
Technology brands entered the category as rivals and collaborators, according to BrandZ. Google parent Alphabet renamed its autonomous car endeavor Waymo. Apple received a permit enabling it to test self-driving cars in California.
Amazon, the 800-pound business disruptor, has talked about selling cars. And autos are available on Alibaba, usually in flash sales, said BrandZ.
Mike Bentley, executive vice president, global chief strategy officer, for GTB, outlined four things shaping the future of the automotive industry:
One is electrification. It seems sure that power trains will shift, but when and where and the penetration is less clear. As electrification grows, gas will become cheaper. Second is what people are calling car sharing. Third is autonomous vehicles. Finally, it’s the definition of mobility. We think of mobility as transportation of the human body. But what about Amazon? I don’t need to go to the shop for my groceries when Amazon delivers them to me. I haven’t moved. The object has moved. So, there is a fundamental reshaping of what we mean by mobility.
The BrandZ study combines measures of brand equity based on interviews with more than 3 million consumers globally using data from Bloomberg and Kantar Worldpanel.