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Tesla's Latest Competition: A Vacuum Cleaner Company?

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Tesla's Latest Competition: A Vacuum Cleaner Company?
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Morgan Stanley’s Adam Jonas said that Dyson, a maker of vacuum cleaners and hand dryers, had entered the Auto business.

The Guardian reported on Wednesday that the UK government appears to have “accidentally disclosed” that Dyson is in the process of developing an electric car using public funds. Analyst Adam Jonas pointed out that the company is renowned for a range of electronics and appliances, including vacuum cleaners, hand dryers and bladeless fans, while all these products use the types of motors found in electric cars.

Dyson Acquires Sakti3

In October 2015, Dyson acquired a lithium-ion battery producer Sakti3 for $90mm. Since then, Dyson has announced plans to invest £1bn in battery technology over the next 5 years. “Dyson claims thatSakti3's solid state technology is potentially smaller, safer, more reliable and longer-lasting than the most advanced lithium-ion batteries on the market today,” Jonas wrote.

Related Link: Tesla Unveils Model 3 Logo, Sends Out Email To Prospective Buyers

What The News Means

For over a year, Morgan Stanley had been expected new entrants to disrupt the traditional automotive industry. However, the term "nontraditional players" had been used to refer mostly to Silicon Valley firms like Apple Inc. (NASDAQ: AAPL) and Alphabet Inc (NASDAQ: GOOGL).

Jonas, who has an Overweight rating for Tesla Motors Inc (NASDAQ: TSLA), commented, “Dyson, whose core business is appliances, was certainly not at the top of our list of co's vying to get into the car business...Who else is out there?”

Latest Ratings for TSLA

DateFirmActionFromTo
May 2017Morgan StanleyDowngradesOverweightEqual-Weight
May 2017Evercore ISI GroupReinstatesOutperformOutperform
Apr 2017PiperJaffrayUpgradesNeutralOverweight

View More Analyst Ratings for TSLA
View the Latest Analyst Ratings

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