Burn baby, burn
Tesla's trading frenzy is, of course, attributable at least in part to the company’s controversial CEO, who has sent traders into a spin with tweets (Xs?) on many occasions, including the infamous “funding secured” tweet that landed him in hot water with the SEC, and led to multiple class action lawsuits. But, controversies and broken promises aside, Musk has presided over a stunning 15 years at Tesla, taking the company from cash burning startup to cash flowing giant.
Money motivation
Environmental reasons have always existed, but nothing motivates like money, which is why Tesla’s recent profitability has spurred the efforts of older rivals. Volkswagen is investing a staggering $193 billion in electric cars and software, General Motors has made a bold commitment to cease the production of gas-powered cars by 2035, and Ford is gearing up to produce EVs for the masses. The startup scene has exploded too, from electric truck manufacturer Rivian to the Vietnamese EV powerhouse VinFast, which hit a valuation of $86 billion on its first day of trading.
Even with this surge in competition, Tesla remains the front runner, with a commanding 61% share of all fully electric cars ever sold in the US, a dominance greater than that of Apple in smartphones. But globally, Tesla's supremacy is teetering, as Chinese manufacturer BYD is on the brink of outselling Tesla in the all-electric vehicle segment.
Low batteries and long roads
Despite the technological leaps made in the sector, the vast majority of drivers haven’t made the switch from gas to electric. High costs and "range anxiety" have fueled hesitation, leading many to opt for hybrids, which have outpaced EV sales this year. Perhaps surprisingly, just 8.6% of all auto sales in Q3 in the US were all electric. Tesla sees this as an opportunity, with an ambitious target to manufacture 20 million cars annually by 2030, double the current output of today's top manufacturer, Toyota.
It’s easy to think of a sudden technological change, that we’ll wake up one day and everything will be electric, but the reality will be very different, as combustion engines and electric motors are likely to co-exist on our roads for many decades to come. If the future is all electric, it is taking its time to get here.
