Boston, MA 06/03/2014 (wallstreetpr) – It has become apparent in recent times that Tesla Motors Inc (NASDAQ:TSLA) is increasingly becoming a threat to the traditional vehicle manufacturers. However, little attention has paid to how the popularity of Tesla could alter the business landscape for other electric car manufacturers such as Toyota Motors Corp (ADR) (NYSE:TM).
Although traditional vehicle manufacturers such as Ford Motor Company (NYSE:F) and General Motors Company (NYSE:GM), for instance, maintain a strong grip in the automotive market in the U.S. and internationally, their days appear to be numbered.
The widespread concern over global warming has pushed governments around the world to adopt policies that promote reduction of greenhouse gas emissions. In the same vein manufacturers of vehicles powered by carbon-based fuels are facing increasing pressure to adopt manufacturing systems that would make their vehicles more fuel efficient, but such manufacturing adjustments come at a cost.
However, vehicles powered by clean energy such as Tesla’s all-electric Model S are gaining favors from authorities and clean environment advocates.
However, even though almost all players in the hybrid and pure electric vehicles market have had something positive to show for the investment, Tesla Motors Inc (NASDAQ:TSLA) appears set to become a big disappointment to its peers.
Study Finds Toyota Vulnerable
According the latest research finding by IDTechEx, an independent market research firm, Tesla appears capable of cannibalizing peers in the electric vehicle industry and Toyota Motors seems to be the most vulnerable target.
The reason the research firm believes Tesla is poised for great things is because of its planned mega cell production factory. Tesla Motors Inc (NASDAQ:TSLA) plans to invest about $5 billion in a huge factory that will produce lithium-ion cells used to power its electric vehicles.
Although the company is facing overwhelming orders for its flagship Model S car from markets such as China and Europe, Tesla cannot meet the huge demand because of the production constrained occasioned by battery shortage.
Therefore, Tesla’s mega battery factory will support the company’s production so that it can meet and exceed the delivery expectation of its growing list of customers. In unlocking its production capacity, Tesla will have nothing to stop it from taking the market share from rivals Toyota Motors (NYSE:TM) and Hyundai Motor, for instance.
A promising Industry
In the IDTechEx study, the firm observed that the sale of hybrid and electric cars will triple over the next 10 years, thereby giving opportunity for well-established manufacturers like Tesla Motors Inc (NASDAQ:TSLA) to realize bigger revenue and profits for the long-haul.
