There are many who say that Tesla’s meteoric rise in the auto industry can not continue because there will be competitors coming that will take a bite out of their market. Well I feel that there are no real competitors to Tesla at present and will not be for quite some time. Why? Well we really need to see what a real competitor to the Model S would have to have in order to compete. Here is a list.
1) Fully electric - No hybrid can compete because a hybrid is poor with acceleration, carries unnecessary extra weight in the form of two propulsion systems and also has more moving parts that need to be maintained and repaired all at an increased priced as compared to an ICE car. I think hybrids appeal to buyers of ICE cars that want better gas mileage, not electric cars. Being a hybrid is why the Fisker failed and also why the BMW i8 won’t do well. Besides, hybrid cars have poor acceleration as compared to the fully-electric Model S.
2) Design - Lets face it, at present an electric car is expensive due to the cost of the batteries. This will change in the future and when it does, Tesla’s car prices will come down, but in the mean time electric cars are expensive. Given the expense, no one wants to spend a lot of money on something that looks bad. This is one of many disadvantages of the Nissan Leaf and why it can’t compete with the Model S. Same with the BMW i3.
3) UI - In 2007 When Steve Jobs introduced the iPhone it was a leap in usability in that any application can have any UI it wishes to and this can change dynamically with future updates. This is also exactly the reason that the 17-inch touch screen is a huge advantage for Tesla even if it was an ICE vehicle. Users love the touch interface and the ability to have remote updates with new features. This is the most under appreciated feature of the car. In the future all car interfaces will be like this.
4) Super Charger network - If you are going to have a fully electric car, you need to have a way for people to go on long trips. Tesla is at least 2-3 years ahead of anyone else in this and building this network requires a lot of legwork. Getting the technology, permissions, construction, etc. By the end of 2014 the vast majority of the country will be covered. I think that this is the single biggest barrier to entry for a competitor. There may be a company that builds a car in every aspect very similar to the Model S, but without a supercharger network, why would anyone but it over the Tesla?
5) Tesla Service - I’ve owned many cars including many expensive ones such as a Mercedes, BMW, and Porsche, but by far the Tesla service experience is so superior. First is the fact that with minimal moving parts, the amount of time the car needs to be serviced is much lower and the experience of the Tesla service is second to none.
So whenever you read or hear that other companies will soon be competing with Tesla, please remember that any competitor must have all of these features. The lack of even one is really a deal breaker. This is why Tesla has no competition at present and not soon to have any in near future. The TSLA stock may well have gotten ahead of itself and we may see some pullback, but long term this company is a paradigm shift for transportation.
1) Fully electric - No hybrid can compete because a hybrid is poor with acceleration, carries unnecessary extra weight in the form of two propulsion systems and also has more moving parts that need to be maintained and repaired all at an increased priced as compared to an ICE car. I think hybrids appeal to buyers of ICE cars that want better gas mileage, not electric cars. Being a hybrid is why the Fisker failed and also why the BMW i8 won’t do well. Besides, hybrid cars have poor acceleration as compared to the fully-electric Model S.
2) Design - Lets face it, at present an electric car is expensive due to the cost of the batteries. This will change in the future and when it does, Tesla’s car prices will come down, but in the mean time electric cars are expensive. Given the expense, no one wants to spend a lot of money on something that looks bad. This is one of many disadvantages of the Nissan Leaf and why it can’t compete with the Model S. Same with the BMW i3.
3) UI - In 2007 When Steve Jobs introduced the iPhone it was a leap in usability in that any application can have any UI it wishes to and this can change dynamically with future updates. This is also exactly the reason that the 17-inch touch screen is a huge advantage for Tesla even if it was an ICE vehicle. Users love the touch interface and the ability to have remote updates with new features. This is the most under appreciated feature of the car. In the future all car interfaces will be like this.
4) Super Charger network - If you are going to have a fully electric car, you need to have a way for people to go on long trips. Tesla is at least 2-3 years ahead of anyone else in this and building this network requires a lot of legwork. Getting the technology, permissions, construction, etc. By the end of 2014 the vast majority of the country will be covered. I think that this is the single biggest barrier to entry for a competitor. There may be a company that builds a car in every aspect very similar to the Model S, but without a supercharger network, why would anyone but it over the Tesla?
5) Tesla Service - I’ve owned many cars including many expensive ones such as a Mercedes, BMW, and Porsche, but by far the Tesla service experience is so superior. First is the fact that with minimal moving parts, the amount of time the car needs to be serviced is much lower and the experience of the Tesla service is second to none.
So whenever you read or hear that other companies will soon be competing with Tesla, please remember that any competitor must have all of these features. The lack of even one is really a deal breaker. This is why Tesla has no competition at present and not soon to have any in near future. The TSLA stock may well have gotten ahead of itself and we may see some pullback, but long term this company is a paradigm shift for transportation.
