Executive Briefings

Tesla's Electric-Vehicle Business Model Could Leave Automotive Industry in the Dust

The stunning consumer response to Tesla's Model 3, the $35,000 sedan that was unveiled on March 31, appears to prove that Elon Musk's bold master plan remains on track. Moreover, it could well mark the day that electric vehicles went from being niche to mainstream products.

Tesla's Electric-Vehicle Business Model Could Leave Automotive Industry in the Dust

Within two weeks, Tesla received nearly 400,000 advance orders from customers who put down refundable deposits of $1,000 - some after queuing outside Tesla showrooms - on a car they had never seen.

If Tesla can ramp up production to meet this demand, which has far exceeded industry expectations, it could emerge as the leader in electric vehicles. It could have around 1 million cars on the road by 2020. Indeed, Tesla could be on its way to disrupting the entire automotive industry.

Even if some Model 3 customers have to wait longer than they want for their cars, the intense excitement generated by the new vehicle has already shaken up the industry. Given Tesla’s ability to combine driving performance, new technologies, and online connectivity with outstanding design, it is clear that a major new competitor has arrived on the automotive scene—one that could be large enough to affect business models that today’s leading car makers have honed over the past century.

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Within two weeks, Tesla received nearly 400,000 advance orders from customers who put down refundable deposits of $1,000 - some after queuing outside Tesla showrooms - on a car they had never seen.

If Tesla can ramp up production to meet this demand, which has far exceeded industry expectations, it could emerge as the leader in electric vehicles. It could have around 1 million cars on the road by 2020. Indeed, Tesla could be on its way to disrupting the entire automotive industry.

Even if some Model 3 customers have to wait longer than they want for their cars, the intense excitement generated by the new vehicle has already shaken up the industry. Given Tesla’s ability to combine driving performance, new technologies, and online connectivity with outstanding design, it is clear that a major new competitor has arrived on the automotive scene—one that could be large enough to affect business models that today’s leading car makers have honed over the past century.

Read Full Article

Tesla's Electric-Vehicle Business Model Could Leave Automotive Industry in the Dust