Tesla Motors Inc (NASDAQ:TSLA) has huge opportunities in Asia, but at the same time, it also has a lot of challenges to face in the region in the field of electric vehicle manufacturing in comparison with North America or Europe, says Seeking Alpha contributor Nick Cox.
Challenges and opportunities for Tesla in Asia
To become viable, Tesla needs to succeed in Asia, but it has tough competition there. China’s BYD is Tesla’s chief competitor in Asia, and it has big investors such as Warren Buffett and Samsung. Announcements have also come from several other manufacturers that they will soon begin manufacturing in China. Recently, Tesla CEO Elon Musk shared his plans of integrating EVs, solar energy and battery storage. Though the idea was not welcomed by some, this is already happening in China, the report says.
Asia has witnessed massive growth and development in recent times, not just from manufacturers but also from the governmental regulation perspective as well. Asia is home to many major auto markets, with China being the world’s largest, Japan the third largest and India the sixth largest. Many Asian governments are seriously considering EVs, and many have announced new incentive policies for EVs, including China and South Korea.
It seems that Musk has realized this since he recently made announcements regarding Tesla entering new Asian markets. Earlier this year, he said that Asia is Tesla’s biggest area of expansion. A lot of capital and management expertise is needed to catch the wind in Asia, and it remains to be seen whether Tesla has that or not.
Tech rivals also in the race
All the major established automakers have already started working on EVs with differing enthusiasm. However, it seems that many of the established players such as Mercedes and Audi are taking a lot of precautions with their moves. In the short term, they won’t have any competitive vehicle on the road. Tech companies such as Alphabet are also trying their hand at autonomous vehicles, but their timing is uncertain.
In other Tesla news, one of its major employees is leaving its maps and navigation division. Bill Chen, who had been heading the division for past two years, is now leaving the company, said The Information. Chen worked with Apple’s mapping team before joining Tesla. It’s a big loss for the EV firm as highly detailed maps are important to ensure that autonomous cars operate safely.