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In response to a Seeking Alph article I wrote:

The headline, "TSLA: Tesla: Electric Vehicle Market Competition Is Heating Up" is wonderful news, it shows there is no stopping the EV revolution.

The headline, "Tesla: New Wave Of Competitors Threatens EV Dominance" highlights what one should expect in free, competitive markets. What counts is not the competitors but the survivors. 100 years ago there were lots of competitors, I listed 100 brands, but there was no stopping Ford. Most of those 100 brands simply died out as the industry consolidated.

One usual argument by bears is the deep pockets of incumbent car makers. In fact, ICE models are the big problem incumbents have because they must divide their attention between new and old. There is a lot of literature out there about it including "The Innovator's Dilemma" by Clayton Christensen and "Living on the Fault Line" by Geoffrey Moore.

Another argument is the new technologies that will eat Tesla's lunch including solid state batteries and hydrogen. In technology adoption, path dependence plays a very important role. Before they invented the term it was called "first mover advantage." VW wants to use solid state batteries but they won't be in production until 2024.Think of the time to market advantage of Tesla's new 4680 battery cells now in production at pilot scale and promising a 50% cost reduction. By 2024 VW's solid state batteries won't be competing with 2020 technology. The hydrogen fuel infrastructure does not exist. The natural gas diesel engines died for lack of NG fuel infrastructure. Tesla took steps to create their charging infrastructure and by now independents are joining in. First mover advantage is very powerful.

For investors the question is on which horse to bet. The odds favor the current leader so that's the way to bet.

https://seekingalpha.com/article/4394936-tesla-new-wave-of-c...

Denny Schlesinger
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There is no competition. Legacy manufacturers' EVs are competing only with their own ICE vehicles, because they aren't even in the same league as Teslas. Maybe a couple of legacy manufacturers will survive -- those that get propped up by their governments to preserve jobs, social stability, etc.

The arguments you are refuting were refuted years ago. They've never had any validity.

For investors the question is on which horse to bet. The odds favor the current leader so that's the way to bet.

Tesla is accelerating away from the pack, so the answer is beyond obvious. Really the only question is whether TSLA has achieved most of its gains already, or whether the future for the stock is bright. What I see is that automotive has mostly fallen and energy is next. The total addressable market for Tesla is mind-boggling.

-IGU-
(optimist)
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Tesla is accelerating away from the pack, so the answer is beyond obvious.

Just wanted to chime in here with my usual observation that this sentiment overlooks the significant success that legacy automakers have had in selling EVs outside the U.S.. Tesla absolutely dominates the U.S. EV auto market - but outside the U.S., it faces much more robust competition. For example, YTD the best-selling EV in Europe isn't a Tesla - it's the Renault Zoe.

Looking only at EV's made by Tesla and legacy automakers (ie. no Chinese firms, no PHEV's), here's the top-selling cars globally last year and this year through October:

		 2019			   2020	
Model 3 221274 Model 3 260927
Leaf 58909 Renault Zoe 74124
Renault Zoe 38722 Model Y 52294
Kona EV 36409 Kona EV 45693
BMW i3 34050 Leaf 41646
Model X 30559 Audi e-Tron 36246
VW e-Golf 29401 VW e-Golf 35071
Model S 21794 Kia Niro EV 29701
Peugeot 208 EV 25001

Tesla 273627 Tesla 313221
Legacy 197491 Legacy 287482

All sales figures from http://ev-sales.blogspot.com/

Tesla is definitely still the market leader, no doubt - they still have more than 17% of the overall plug-in market, and an even larger share of the pure EV market. That's well ahead of the nearest legacy maker (VW, at 7% of global share). But the legacy automakers are growing their EV production pretty solidly, and it's not clear that Tesla is still accelerating away from the pack.

Albaby
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But the legacy automakers are growing their EV production pretty solidly, and it's not clear that Tesla is still accelerating away from the pack.

That's one of the reasons for Giga Berlin. Local manufacture brings the price down and Musk has talked about designing an European model that is a better suited for the narrow streets in some EU cities.

China worries me more because of the government sponsored hurdles that all Asian Tigers have displayed.

Denny Schlesinger
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That's one of the reasons for Giga Berlin. Local manufacture brings the price down and Musk has talked about designing an European model that is a better suited for the narrow streets in some EU cities.

Absolutely. My post wasn't about whether Tesla has room to grow - of course it does. Rather, i just wanted to highlight that the legacy automakers are also growing their EV production, and growing at a pace that collectively meets (and perhaps exceeds) Tesla's growth. It's just not very evident in the U.S. because they're mostly ignoring the U.S. market. That's still amazing for Tesla - but other car companies are also building up solid production of EV's in non-U.S. markets. We're likely to see a future in which many, if not most, of today's legacy car-makers successfully and productively develop substantial marketshare in electric vehicles.

Albaby
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