Tesla’s Tough Road Ahead

The industry zeroes in on the upstart Tesla.

The industry zeroes in on the upstart Tesla.

The Tesla bears are on the march, tearing away at the startup EV maker’s still-sky-high valuation, but not because low oil prices are killing off EVs. Quite the opposite, in fact. As I explained in last week’s Bloomberg View column, falling oil prices will not kill off alt-energy drivetrains for a wide number of reasons, most importantly because it’s one of the few ways to stand out in a sea of commodified internal-combustion engine-powered cars. Though automakers could easily plan a low-efficiency product cycle in response to low oil prices, they are keeping the technological arms race going. And that is Tesla’s real challenge: not a decline in EV interest, but strong competition from established players with more experience building vehicles at scale. [Continue Reading]