Tesla Motors Inc (NASDAQ:TSLA) cars will see massive competition in Europe by 2020, as most big-name manufacturers now want to make their own electric cars in-line with European Commissions stringent emission laws.
In the US, Tesla car model sales have struggled as consumers remain inclined to purchase low-priced diesel cars over expensive electric-cars that have battery-power limitations. Besides, the low gasoline prices in the past few months have pushed non-electric car sales to the highest in over 15 years in February.
Car Manufacturers want to make electric cars
In Europe, it is a different game for electric cars, since the emission laws are more stringent and becoming tighter by 2020. This places electric car manufacturers like Tesla in an advantageous position. However, this may not be the case, as was witnessed at the Geneva International Motor Show.
Daimler AG(OTCMKTS:DDAIF), Peugeot SA (ADR)(OTCMKTS:PEUGY), General Motors Company(NYSE:GM), are some of the notables who want to have their own upscale models.
More importantly, they want to make their cars more affordable and have longer electric power range.
The mass move towards electric car technology does surprise insiders, as manufacturers had for long ignored the technology based on the slow demand for green cars.
But EU’s 2020-deadline for tighter carbon-dioxide emissions has prodded the manufacturers into green manufacturing.
Besides, after Volkswagen AG’s (ADR) (OTCMKTS:VLKAY) emission-manipulation fiasco there is limited scope in building diesel-engine based alternatives to meet 2020 deadline, most experts opine. However, there was only one big manufacturer who did not want to make an electric car – Fiat.
Fiat Says: not making unprofitable electric cars
Nearly every car maker in the industry, with the exception of Fiat Chrysler Automobiles NV (NYSE:FCAU) hopes to have a model like Tesla Motors Inc (NASDAQ:TSLA) Model X, a SUV. CEO, Sergio Marchionne said that he would rather be profitable, than make cars like Tesla.
Volkswagen AG (ADR)(OTCMKTS:VLKAY) episode has left European manufacturers to strike extra caution and follow Tesla Motors Inc (NASDAQ:TSLA). Of course, their legacy expertise, manufacturing technology and production capacities will be leveraged to remain far profitable than Tesla can currently make.
