(3Bl Media/Justmeans) - Mark Twain once quipped, “reports of my death have been greatly exaggerated.”
The same might be said of the pronouncement of Morgan Stanley analyst Adam Jones, who said “EV’s are dead, long live TESLA.”
Stock analysts are not particularly well-known for their patience, and if Google went back far enough, you could probably find a similar sentiment being expressed by great-granddaddy Jones back in 1908 about the first Fords rolling off the assembly line. The impetus for the comment was an announcement that Toyota was ending its parts contract with Tesla.
Okay, admittedly, EV’s have not become highly profitable overnight, the way that Wall Street likes them. Yes, market penetration is still tiny, and some companies like Fiat, are losing money on every 500e they sell. But think of the size of the battleship that is turning around. In the US alone there are more than 120,000 gas stations. How many EV chargers are out there? Roughly 8,000. How long does the average American hold onto his car? Almost six years. How long has there been a viable, affordable EV on the market? Nissan LEAF sales began in December 2010.
EVs are superior to internal combustion vehicles in almost every way except that:
- They are more expensive
- Charging infrastructure is still being built
- Range is still an issue for many people
- They are not yet considered mainstream
All of this is changing rapidly. As Tesla has already demonstrated, and Jones himself acknowledges, they are being enthusiastically grabbed up by those that can afford them. Jones just happens to call them “compelling performance vehicles that just happen to be EVs.”
The fact that they just happen to be EVs, is not just a coincidence, but rather an outcome of something called low-end torque that electric motors can smoothly deliver in a way that even the best engines can only dream about. In a nutshell, it’s the power available before a vehicle has come up to speed.