Tesla Motors CEO Elon Musk said this week that General Motors’ upcoming Chevy Bolt won’t be a real competitor for their Model 3 car. Of course his comments were in response to the plethora of articles pondering a potential knock-down, drag-out fight between GM and Tesla for the mass EV market in the wake of GM CEO Mary Barra’s announcement about the Bolt.
So which automaker would win that battle? Dinosaur GM or racy relative newcomer Tesla? Perhaps we’ve been looking at this all wrong. In a post on LinkedIn, Don Peppers argues that Tesla actually stands to gain much more from the release of the Bolt than it stands to lose.
Tesla welcomes GM’s competition
Musk has said several times that they welcome competition from major automakers in the electric vehicle market. With someone who has Musk’s personality type, it’s easy to dismiss his comments as a sort of “bring it on attitude” or a sort of beating of the chest as an expression of dominance.
His decision to open up all of Tesla’s patents to competitors helps prove that they do want to advance the EV market, but then again, it’s doubtful he would have done that without having an ace up his sleeve. Tesla could be closer to having more advanced technology than other automakers that are starting from scratch with its patents.
However, this is the same sentiment echoed by Peppers. Indeed, one of the reasons the average consumer may be slow to adopt electric vehicles is because of the lack of credibility. Most still haven’t even heard of Tesla, let alone seen one of its Model S sedans driving down the road. Or even if they have seen one, they probably didn’t take the time to realize that they didn’t recognize the brand on the car.
Tesla to benefit from EV adoption
And since Tesla is still relatively unknown, the only knowledge the average consumer has of electric vehicles is the Nissan Leaf or the Chevy Volt, neither of which is all that appealing. But if GM really does release a 200-mile range electric car, finally consumers will begin to see that EVs are viable forms of transportation. The thought is that this will translate into broader acceptance of Tesla as a result of greater acceptance of electric cars, and thus, Tesla may see more sales as a result.
Tesla has enjoyed the first-mover advantage in terms of offering a long-range electric car, but being the first mover in a market also comes with financial burdens. The automaker is shouldering the burden of building a widespread charging infrastructure on its own with little help from competitors, as its expansion efforts are on a much faster timeline.
If other automakers get into the EV market with serious contenders, it’s possible that the charging infrastructure will grow much more quickly than what Tesla can do on its own. Of course Tesla’s Superchargers are proprietary, which means other cars can’t charge at its stations, at least not currently.
But the automaker has been said to be trying to get competitors to use its charging stations. Tesla drivers use the stations for free, but Tesla could, potentially, make money by charging drivers of other electric vehicles. The key is making the Supercharging technology the standard within the industry, but as of right now, it seems unlikely that Tesla will be successful in this endeavor.