"It doesn't work" is seldom a useful problem description. After fixing  term1 and  term2 in the OPed code to be valid scalar identifiers, here's what I get:

c:\@Work\Perl\monks>perl -w -le
"$term1 = 'Tesla S|Tesla model V|Tesla model|TESLA';
 $term2 = 'Ford RAM truck|2020 Ford Mustand|Ford ranger|Ranger|ford|20
+20 Ford F-250|2020 Ford F250|Ford F 250';
 $term1 =~ s/\-/ /g;
 $term2 =~ s/\-/ /g;
 $input = '... 2020 Ford F 250 is great but I prefer Tesla Model-V ...
+ ';
 ;;
 $input =~ s/\-/ /g;
 ;;
 $input =~ s/($term1)/\<1\>\<$1\>/ig;
 $input =~ s/($term2)/\<2\>\<$1\>/ig;
 ;;
 print $input;
"
... <2><2020 Ford F 250> is great but I prefer <1><Tesla Model V> ...
[download]

This is almost your desired output except that 'Model-V' becomes 'Model V' instead of 'model-V', which I hope you can live with. :)

The root problem might have been more clear had you provided an SSCCE (see Short, Self-Contained, Correct Example) to show the code and the resulting error messages.