Consumers are realizing that Tesla isn’t the only electric car

It’s hard to disagree. A few weeks ago, I tested Chevy’s new Bolt EUV, the squat electric crossover that’s the slightly larger cousin of the Bolt EV, the entry-level electric car that General Motors began selling in 2016. I was blown away by the new Bolt electric utility vehicle. I found it surprisingly roomy and much nicer inside than its staid exterior would suggest.

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I also liked that its interior felt a lot more like a regular car than Musk’s purely touchscreen design style. In the Bolt, you can control the climate control and other systems with hefty knobs and buttons that are easy to find and manipulate while driving; In a Tesla, almost everything is controlled by touching a large screen mounted in the center console.

The best thing about Chevy’s Bolt EUV: The model I tried, which came with almost every option available, including GM’s fantastic driver-assistance program, Super Cruise, had a retail price of just under $38,000. Tesla’s least expensive car, the Model 3, sells for over $45,000 ($65,600). As I drove the Bolt, I asked myself a question that has come up a lot this year: With such great alternatives that don’t carry any of Musk’s political baggage, why does Elon always act like customers have no choice — like he’s the only one game in town would be ?

Tesla’s new vulnerability is a surprising development. At its all-time high last fall in the northern hemisphere, Musk’s auto company was valued at more than $1 trillion, more than the combined value of the world’s five largest automakers. Tesla looked unstoppable. While rival manufacturers suffered from nagging supply shortages that held back sales for much of 2021, Tesla’s once-mocked investments in building its own software and components allowed it to overcome kinks in the supply chain, resulting in record sales.

Then Musk inexplicably turned to Twitter and pushed Tesla off a cliff. That year, when he sold tens of billions of dollars worth of Tesla stock to fund the Twitter deal, and seemed to bank his reputation on taming the squabbling that was roiling one of the most divisive places on the internet Tesla shares fell by more than 60 percent. Its plunge is deeper than most of its peers and far sharper than that of the S&P 500, which is down about 19 percent for the year.

“Tesla is Musk and Musk is Tesla.”

Wedbush analyst Dan Ives

Not all of Tesla’s problems are Musk’s. Like other global manufacturers, the company has faced production delays in China related to COVID-19. It’s struggling to ramp up production at its new plants in Austin, Texas and Berlin. The Federal Reserve’s steady rate hikes and the looming recession have also weighed on Tesla’s fortunes. On Twitter, Musk has repeatedly blamed the Fed for Tesla’s stock weakness.

But analysts and investors I spoke to said these are side issues.

“Tesla is Musk and Musk is Tesla,” said Dan Ives, an analyst at Wedbush Securities who follows Tesla.

Unlike almost every other automaker, Tesla spends next to nothing on advertising. Musk is, and has long been, the company’s sole marketer and chief evangelist, the main driving force behind the world’s desire to buy Teslas. As such, any change in Musk’s cultural standing affects the company’s standing as well. Musk’s tenure as a tweeter was “massive brand destruction for Musk and for Tesla,” Ives said.

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It’s not impossible for Tesla to shake off these problems. Musk has promised to step down as Twitter boss once he finds a replacement; Ives and Gerber told me that if this happens relatively quickly and Musk is somehow re-disciplined to stay away from divisive attitudes online, Tesla could quickly be restored to its former glory.

Tesla still enjoys some advantages over rivals, most notably its network of over 40,000 chargers around the world, making Teslas easier to juice than other EVs. Colin Rusch, an analyst at investment firm Oppenheimer & Co., pointed out that Tesla also has a multi-year lead in certain EV technologies. It has invested heavily in advanced battery design and more efficient manufacturing processes, areas where its competitors are just getting started.

Still, Rusch recently revised down his expectations for Tesla’s stock price, citing increasingly negative sentiment toward Musk.

A lot of people see their cars “as a means of signaling some kind of identity,” Rusch said, “and the Tesla brand and what it means has a few more meanings now than it did before.”

This article originally appeared in The New York Times

https://www.smh.com.au/business/companies/consumers-are-realising-tesla-isn-t-the-only-electric-car-20221227-p5c8ye.html?ref=rss&utm_medium=rss&utm_source=rss_business Consumers are realizing that Tesla isn’t the only electric car

Brian Lowry

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