Tesla (TSLA) plans to greatly expand its electric car sales in the coming years, but first it must provide a fueling infrastructure that covers not just the U.S. and Europe but most of China’s east coast. Are Tesla’s targets too high (as Bank of America (BAC) analysts believe) or do they warrant serious concerns from their competition? Post Tesla’s SEC 10-K filing last week, we took a quick look at Tesla’s future versus its competitors’ — BMW (BMW), GM (GM), Lexus, and Volkswagen (VOW) — in the electric car market:
BMW’s entrance to the electric car market is aimed at the middle market. Its i3 will be approximately half the price of Tesla’s Model S, but can only travel half the distance of the Model S on one fully charged battery. A spokesperson for BMW said the i3 is being produced as a vehicle for the city. Individuals concerned about the environment should also note BMW’s production of the i3 leaves a smaller environmental footprint than Tesla.
Rumors about Volkswagen’s recent link with QuantumScape have people believing it will use better batteries than Tesla’s current batteries — not only in VWs but in Audi and Porsche vehicles as well. Perhaps if the rumors are true, VWs use will strengthen its current E-Golf fleet and make an already-accessible vehicle more reliable for everyday public. Until then, VW and BMW face the same issue of tackling efficient batteries that provide the necessary power.
Earlier this year, during the North American International Auto Show, GM announced it will soon produce electric cars to match Tesla’s Model E. GM reports these cars will cost half the price of Tesla’s current Model S but will match it in mileage distances. To this, however, GM is facing problems producing new and improved batteries at a cost-effective price.
Lexus, Toyota’s (TM) luxury spinoff, is rumored to have actually borrowed Tesla’s battery technology. Lexus is reportedly to build an electric supercar that could premier later in 2015. This comes half a year after Lexus VP admitted to losing sales to the Model S.
Although Tesla is certainly facing huge challenges, they’ve already built a substantial number of fueling “stores” in both America and Europe as well as resolved several of the issues its competitors are currently facing. Its progression in China may be their only shortfall. However, stock analysts have mixed reactions in lieu of these high-set goals. Some believe the stock will drop from its current $200 per share to as low as $65; other analysts have figures rising as high as $400 per share. While most analysts are less extreme in their estimates, it certainly shows the range of uncertainty regarding Tesla’s projected numbers.
Within Tesla’s competitive set, most products are still in early development — which means Tesla will continue to have the upper hand in the electric car market. Lexus’s distant supercar may be the only car to make an appearance this year. So will Lexus’ supercar entry act as a boost to Tesla’s bottom line (with Lexus using Tesla’s technology), or will Tesla finally have some real competition to face in the 2015 electric car market?