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Tesla Former Board Member Says Elon Musk Company Won't Remain 'King Of The Hill In Electric Forever'

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Tesla Former Board Member Says Elon Musk Company Won't Remain 'King Of The Hill In Electric Forever'

A former board member of Tesla Inc (NASDAQ: TSLA) said Tuesday that the company is unlikely to remain the “king of the hill” in electric vehicles forever, CNBC reported.

What Happened: Steve Westly said on CNBC’s “Power Lunch” that he had been bullish on the Elon Musk-led automaker for the last 10 years and it’s “hard to imagine an auto company executing better than Tesla has.”

Westly pointed to the company’s latest earnings release in January where it said it had a “multi-year horizon” and expected to achieve 50% average annual growth in vehicle deliveries.

See also: How to Invest in Tesla Stock

“No one else in the auto world is doing that. Having said that, Tesla is not going to be king of the hill in electric forever,” said Westly. 

Why It Matters: The venture capitalist noted that there have been large-scale commitments on EVs from legacy automakers such as General Motors Company (NYSE: GM) and Volkswagen AG (OTC: VWAGY).

“Tesla is not just getting hit from the high end,” said Westly on the availability of EVs from Volkswagen marques such as Audi and Porsche. Tesla also faces increased competition from Chinese EV rivals, which have more affordable offerings.

The analyst noted increased competition in Europe where according to him the company was “No. 1, they’re now No. 4.”

See Also: Tesla's Share Of European EV Market Reduced To 3.5%

 

“They’re getting competition from all sectors. They’re going to have to double down to compete.”

Tesla’s plans to make a more affordable $25,000 vehicle have left Chinese rivals such as Xpeng Inc (NYSE: XPEV), Nio Inc (NYSE: NIO), and others unfazed

In January, a two-door $4,500 EV made by Wuling — a joint venture of GM and state-owned SAIC Motor — outsold Tesla’s Model 3 in China by nearly two-to-one. 

Price Action: Tesla shares closed 4.45% lower at $686.44 on Tuesday and gained 0.34% in the after-hours session.

Click here to check out Benzinga’s EV Hub for the latest electric vehicles news.

 

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