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One of the most prominent arguments against owning shares of
Tesla Motors IncTSLA is that low oil prices, especially at the gas pump, minimizes demand for fully electric cars.
Speaking to
CNN Money, Tesla's CEO Elon Musk lent some credence to the theory, but argued his company is in a substantially better position versus its peers.
"[The] industry as a whole, I think, will definitely suffer from lower oil prices," Musk told CNN Money in an interview on Monday. "It just makes economic sense."
Musk added his company will be less affected because Tesla's "significant product differentiation." He added that lower priced electric vehicles will be the ones taking a "pretty big hit" as there is "little to no differentiation" between a gasoline version of the vehicle and an electric version.
"If they're about the same, and the electric version doesn't have a compelling economic proposition, then you've got a real issue in the market," Musk added.
Shares of Tesla were trading at $200.10 late Monday morning, down 1.21 percent on the day.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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