Tesla Stock Price 1/31/20

Tesla’s stock price has doubled in the past 3 months. With things seemingly going normally for Tesla, it’s hard to see exactly why. With so many investors betting on Tesla crumbling to established car manufacturers the odds seem to be stacked against Tesla. So today we’ll unwrap everything going on and see why things seem to be going so well for them.

Market dominance

Tesla has come a long way from the startup we once knew. They’re no longer plagued by the production issues and inefficiencies we’d gotten used to hearing about. Tesla has been able to focus on delivering as many cars as possible. And orders for the Model 3 have not stopped coming in.

Tesla Model 3 is the 9th most popular car in the US. Hype for this car can not be contained. It’s one of the first truly affordable electric cars on the market that doesn’t have any compromises. It’s fast, sleek, and delivers performance unlike any gas-powered car. The Tesla Model 3 has done more than any other car to drive EV adoption and carve out EVs place in the market.

But with consumers more interested than ever in buying electric, Tesla has stood tall in the face of giant auto manufacturers. People don’t just want an EV, they want a Tesla. Tesla sales accounted for 77 percent of electric car sales in the US.

Other manufacturers are struggling to build competitive cars that have the same features as the Model 3 at the same price point. They often opt for building higher-end luxury models that don’t interest consumers as much, especially when even those luxury models are still barely on par with the Model 3.

Impressive technology

Why are these giant car manufacturers struggling to compete with Tesla? While it seems like decades of experience building cars would help them out a bit, Tesla has been developing EV technology longer than anyone else. Tesla has been around since 2003, and they’ve had plenty of time to refine what they have.

Some cars can barely hit 200 miles of range like the XC40 Recharge we took a look at the other day. In a Q4 earnings report on Wednesday, Elon Musk stated that we can expect a Model S capable of hitting 400 miles of range. And with superchargers capable of adding 75 miles of range in just 5 minutes it’s clear that Tesla’s battery technology is far ahead of the competition.

And we can’t forget Autopilot! While other manufacturers have driver assistance features, no one puts as much emphasis on them as Tesla has with Autopilot. There really is nothing quite like it. Things like the summon feature really have no competition. And seeing regular updates to the tech makes consumers even more confident that their Tesla will be more capable than a competing car.

Exciting offerings on the horizon

The Tesla Model Y is an affordable mid-size SUV that many industry analysts expect could sell even better than the Model 3. We talk a lot about how consumers overwhelmingly want SUVs. And while the Model X is certainly an impressive car, the $39,000 starting price of the Model Y is a game-changer. This puts it in the same sought after price range of the Model 3, and everyone else is already struggling to compete with that.

With Tesla releasing the most popular type of car at a price no one can beat, they’re absolutely set to dominate. And they’ve just released pictures confirming they’ve started production quite a bit earlier than we expected. Production began earlier this month, with deliveries set to start going out in March. We didn’t expect to see this car till later in the year. With so many competing models coming in late 2020 Tesla is going to get a nice head start.

And as divisive as it is, the Cybertruck is far more popular than even Tesla expected. They already have over 250 thousand reservations, more than they expect to be able to make in 4 years. While Tesla may struggle to increase its production capacity for the Cybertruck, they were very successful in doing so for Model 3.

Our take

Tesla’s stock price is so high for one reason. They have been working on electric cars for longer than anyone else. After so many years of experience, Tesla is really good at making electric cars. They’ve developed better battery technology and features than everyone else. They used that technology to build the most competitive electric car.

And now they’re releasing 2 of the most hyped cars we have ever seen. Not only have things been going well for Tesla, everything points towards them gaining even more momentum. And until other manufacturers get serious about going head to head with Tesla they’re going to continue their dominance. The only thing that could slow Tesla down at this point is someone putting their focus on electric, and putting the work in to develop better technology.

With both Subaru and Nissan betting big on electric, the next few years of electric cars could be very interesting. Both of those companies have aspirations to have a significant amount of their sales to be electric in the next few years. But until they’re able to get that ball rolling Tesla can continue to enjoy their total domination of the market, and their stock price will continue to rise.

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