Without question, Tesla has been on a roll over the past year or so, delivering more cars than it ever has and gaining an immense amount of financial success. Due to that, you’d imagine that automotive execs throughout the industry are afraid of Tesla’s recent success explosion. However, that doesn’t seem to be the case. In fact, BMW CEO Oliver Zipse recently spoke at a tech conference and claimed that he doubted the Silicon Valley brand’s long-term success.
“It won’t be easy for Tesla to continue at that speed because the rest of the industry is moving ahead big time,” Zipse said.
Ardent Tesla fans and Elon Musk stans will laugh at such comments, claiming that Zipse is blind to the fact that Tesla is taking over. There admittedly is a whiff of pretention to think that Tesla won’t continue at its current pace, considering its success. That said, it’s not hard to see why Zipse might feel that way.
At the moment, Tesla is one of the only EV manufacturers with battery ranges well over 200 miles. It’s also the biggest household name in electric vehicles. So anyone that wants a true everyday electric vehicle is going to think of Tesla first. However, the rest of the industry is, without a doubt, catching up. BMW has the iX on the way, with 300 miles of range, as well as the i4 with similar range. Audi just launched its stunning e-tron GT, Ford released the impressive Mustang Mach E and Jaguar just announced that it would go fully-EV by 2025. So the industry is close to matching Tesla’s capabilities.
Unfortunately for Tesla, once that happens, it could be game-over. Not only would legacy automakers have the same level of technology as Tesla but with far, far more capable manufacturing. Legacy automakers will be able to produce not only a far greater volume of EVs than Tesla, thus getting cars to customers on time (something Tesla has struggled with since its inception), but they will also be able to provide a wider variety of EVs.
Tesla currently only sells four models. By 2030, most automakers will have be able to at least match that, if not surpass it. That would provide customers with a wider range of EVs to choose from, more options, and much better dealer networks with vastly superior service departments.
That’s not to say that Tesla can’t eventually match legacy automakers in those regards as well but, thus far, Elon Musk’s brand hasn’t been able to come close to doing so. So there’s no evidence that it will be able to do so anytime soon.
When legacy automakers do catch up in terms of technology, it will be significantly easier to buy an EV from one of them than from Tesla. Not only will it be easier but there will be far more choice and easier service and maintenance. So while BMW’s CEO might sound like the old curmudgeon, mocking the new upstart, he does have a point. Automakers such as BMW, Mercedes-Benz, Audi, Porsche, Volkswagen, GM and Ford have all been building cars for a combined hundreds of years longer than Tesla. So if those brands have the means to compete, they’re going to be damn-near impossible to beat.
[Source: Bloomberg]
