The best-selling Model Y is a favored next stop from the rest of the lineup, but until Elon Musk's automaker enters new segments - such as Cybertruck - the compact SUV might be a final destination.

For a relatively new brand, Tesla is already building world-class loyalty numbers. Winner of S&P Global Mobility's 2022 Automotive Loyalty Awards for Overall Loyalty to Make, Most Improved Make Loyalty, Alternative Powertrain Loyalty to Make, and Ethnic Market Loyalty to Make, Tesla has not only demonstrated strong appeal to new buyers but a compelling ability to retain existing ones. But where do Tesla owners go when they buy their next vehicle?

A whopping 59.9% of all Tesla Model S large sedan owners replace their cars with another Tesla, based on the most-current rolling-12-month data through June 2023. When it comes to the compact Model 3 sedan, the number is even higher: 72.8%.

When a Model 3 sedan owner purchases a new vehicle, the most common choice is to acquire a Tesla Model Y crossover. Over the last 12 months, 40.3% of Tesla Model 3 that returned to market for a new vehicle switched to a Model Y crossover SUV, according to S&P Global Mobility analysis. Meanwhile, 26.1% went for another Model 3.

"Tesla is very successful at migrating customers from a Model 3 to a Model Y, which contributes to high loyalty rates," said Kent Chiu, associate director of consulting services at S&P Global Mobility. "Tesla has taken advantage of the industry's shift toward CUVs. By putting the Model 3 to market first, followed by the Model Y shortly after, it gave customers a path to migrate through the portfolio."

Tesla also has done well to convert Model 3 households into advocates for electric vehicles in general - with 78.9% of Model 3 households staying loyal to the battery-electric fuel type - most of them moving to the Model Y.

As for the hot-selling Model Y, it has the highest model loyalty rate, at 37.3%, among electric compact utility vehicles with return-to-market volumes greater than 1,000. The Ford Mustang Mach-E is second at 18.5%.

Photo courtesy of Tesla Motors

But whereas the Model 3 succeeds in loyalty by moving owners to the Model Y, Tesla's compact crossover may be the end of the road for many households, because the price jump to a Model S or X is so significant, Chiu said. About 70.5% of Model Y households acquire another EV. And while that is a strong rate, it's lower than the Model 3. Those households seeking another vehicle after the Model Y often are looking at internal-combustion SUVs or trucks - a defection Tesla hopes to remedy with its oft-delayed Cybertruck.

And what about the original, long-in-the-tooth, Model S? While 21.7% of owners return to another Model S, a significant 18.6% of former Model S owners also choose to go for a Model Y. "Migration can be downsizing as well," Chiu said. "Some Model S and X households are downsizing to a Model 3 or Model Y as replacement vehicles."

About 11.7% of Model S owners go for a Model X SUV for their next car, while 7.9% step down to the Model 3, resulting again in a total 59.9% loyalty rate.

Tesla's product portfolio has its limits, so when owners leave, it tends to be for a vehicle-type that Elon Musk doesn't (yet) offer. An increasing number of luxurious EVs from established brands are hitting the market, wooing some early EV adopters away.

When it comes to the Model S, the most popular non-Tesla replacement is led by the Lucid Air at 3.4%, followed by the Rivian R1T at 1.8%, Mercedes-Benz EQS at 1.6% and Rivian R1S at 1.2% All are fresher to market than Tesla's aging Model S, which was introduced in 2012.

"Historically, as a vehicle ages, the loyalty rates decline. And each time there is a facelift, refresh, or redesign, loyalty increases. So the defection to Mercedes-Benz, Porsche, and Lucid is consistent with that pattern," Chiu said.

The Rivian R1T also factors as the most popular non-Tesla for those replacing a Model 3 or a Model Y, at 1.3% and 2.1%, respectively.

Tesla's Cybertruck was unveiled in 2019 and originally intended to enter production in 2021. Since then, Rivian released its R1T pickup and R1S SUV, while Ford released the F-150 Lightning, which will soon be joined by the Chevrolet Silverado EV and the electric Ram 1500 REV.

Add in future brands like the all-electric Scout, and the electric pick-up segment is already beginning to look crowded.

As such, Cybertruck is vital to keeping Tesla fans within the brand, along with other products to expand the portfolio, Chiu said: "The Cybertruck, a second-gen Roadster, and a vehicle positioned below the Model 3 all have been promised, and should migrate existing Tesla owners up or perhaps sideways within the brand. Now Tesla needs to get them to market."

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This article was published by S&P Global Mobility and not by S&P Global Ratings, which is a separately managed division of S&P Global.