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Tesla Spends $6 On Advertising Per Vehicle; The Industry Average Is $1,000

Tesla Spends $6 On Advertising Per Vehicle; The Industry Average Is $1,000
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Tesla Motors Inc (NASDAQ: TSLA) has gotten a lot of criticism for its aggressive spending in recent years, but there is certainly one thing that the company is not overspending on: advertising.

In a new email to investors, Global Equities Research analyst Trip Chowdhry discussed one astonishing metric about Tesla’s young business that should give Tesla bulls reason for optimism.

While other car companies are spending between $248 and $3,325 in advertising per car sold, Tesla is spending just $6 per car.

“Tesla Power and Leverage is unprecedented,” Chowdhry told investors. “$6 of Ad Spent per Vehicle for the product generating more than $8 Billion in revenues and more than $14 Billion in bookings is unheard of in the Industry.”

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According to Global Equities Research, Toyota Motor Corp (ADR) (NYSE: TM) and Honda Motor Co Ltd (ADR) (NYSE: HMC) have the next lowest average ad costs per vehicle in the entire auto industry at $248 and $258, respectively.

On the other end of the scale, Tata Motors Limited (ADR) (NYSE: TTM) spends $3,325 in advertising per Jaguar sold and Ford Motor Company (NYSE: F) devotes $2,550 of ad spend to each Lincoln sold.

Chowdhry remains extremely bullish on Tesla and has a $385 price target for the stock.

Disclosure: The author holds no position in the stocks mentioned.

Latest Ratings for TSLA

Oct 2016Goldman SachsDowngradesBuyNeutral
Sep 2016Cowen & Co.Initiates Coverage onUnderperform
Jun 2016Argus ResearchDowngradesBuyHold

View More Analyst Ratings for TSLA
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