Posted on September 18, 2018 by Matt Pressman
For Tesla, prophesies of gloom and doom from Wall Street's short sellers typically start with a big assumption. Big Auto must be rushing to market with a flood of electric vehicles to compete with Tesla... right? Analyst Toni Sacconaghi at Bernstein (via Marketwatch) says, "let’s make this clear: there is no actual flood of competition coming."
Sacconaghi and his team of analysts at Bernstein elaborate, "We tallied up every announced electric vehicle arriving in the U.S. between now and 2022, and the results were stark." The Model 3, which the analysts expect will account for 70% of Tesla’s revenues within two years, "faces no credible competition whatsoever until 2020."
Wait... what about all the hoopla surrounding the Chevy Bolt? Wasn't GM supposed to take down the Model 3 and embarrass Tesla? Bernstein notes, "While matching the range and price point of the Model 3, the Bolt arguably remains a lower-end car, without the luxury nameplate, the styling, the performance, or even the electronics offered by Tesla."
Above: Tesla's Model 3 and GM's Chevy Bolt (Source: Wikipedia Commons / Mariordo)
Bernstein points out, "A side-by-side comparison in real life makes the contrast particularly stark – for one thing, the Bolt is a whole 20 inches shorter than the Model 3. GM has been relatively mum on its specific electric vehicle plans going forward... [and] we do not expect it to sell clear competitors to the Model 3 anytime within the next 3 years.”
In fact, when it comes to Model 3 competitors, it's reported that the only possibility on the horizon might be Volvo's "all-electric Polestar 2 sedan... [Furthermore] the Model S luxury sedan and the Model X luxury SUV will only face two competitors – the Audi e-tron Quattro and the Jaguar I-Pace – up until 2020, the analysts said."
Above: Audi's US President was careful not to discuss, in-depth, the e-tron's range or charging network (Youtube: CNBC Television)
For all the hand-wringing about potential rivals for its electric cars, the naysayers gloss over Tesla’s greatest long-term competitive advantage: its "unparalleled brand," analysts said.
According to the analysts, even if electric car competition does arrive late to the party, Tesla will be “well positioned to defend its share.” Why? Incumbent auto makers will help “validate and expand the existing market for electric cars” rather than hampering Tesla with their own electric vehicle launches.
Above: A look at Volvo's concept car aiming to be Model 3's next all-electric competitor, the Polestar 2, slated for launch in 2020 (Image: CleanTechnica)
While naysayers, short sellers, and gullible reporters announce Tesla's EV reign is about to end, Bernstein's analysis shows otherwise. In the end, the mythical "Tesla Killer" narrative, promoted in the press, might actually have things backwards.