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January 23 2022 12:01 PM ˚
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Tesla, Wall Street and the real world

TESLA VIRUS
The Tesla car manufacturing plant in Fremont, California, May 12, 2020. (Photo: NYTimes)
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The much-discussed CEO of Tesla, the Boring Company, and SpaceX, among other innovative investments, Elon Musk, gained superstar status among business leaders around the world. He is one of the richest people in the universe right now and has become some sort of guru of the electric vehicle (EV) movement.اضافة اعلان

Recently, Tesla, the world’s most valuable car company in terms of financial value, lost a staggering one-third of its market value in a day of trading due to continued financial market volatility and uncertainty towards the EV sector leader, only to regain that week.

But the realities of the global automotive industry are not dictated by the media or by Wall Street. Building and maintaining a car brand that would survive in today’s world is a different story, according to Musk himself, who admitted that his “disruptive” approach towards changing how cars are built seems to lead Tesla onto rough terrain, major production delays, and embarrassing quality problems that made even Musk admit he was living in “production hell”.

For a relatively young car company founded in 2007, Tesla has faced many difficulties. As a mere Silicon Valley startup that wanted to change the automotive world by making EVs that actually work, it made that crazy idea happen with the Tesla Roadster electric sports car. Fast forward to 2020, where Tesla’s production volume has reached a little under half-a-million units and it has gained the leading position in the automotive race for electrification. Through this journey, Tesla had a long period of “teething” in which Elon Musk himself described the difficult situation, citing many quality-control issues and many basic production problems that delayed deliveries of his already booked and sold cars, hampering the young company’s plans to keep making headway in sales and actual market share growth.

In reality, the real value of Tesla comes from the innovations that this company has and will to continue to invested so much in. The foremost of these innovations are its battery technology, electric propulsion solutions, and the technology of self-driving — or “autopilot” as Tesla calls it. These major aspects of automotive technology are the real areas of competition, and Tesla has gained a remarkable lead over the “legacy” car industry; these are Tesla’s real assets and the real driving force of its leadership of the car industry’s EV sector.

Tesla’s success was not achieved by just building attractive and viable EVs. Tesla disrupted the business model of the traditional car companies by selling its vehicles directly to customers, cutting out the “middleman”, and allowing people to order their cars, choose their specs, and pay online, as well ensuring customers receive their car directly from the factory. Tesla’s many innovations also include the construction of a charging network and the ability to update its cars’ software remotely.

The traditional leaders of the global car industry, such as the likes of Volkswagen Group, the world-leading manufacturer in terms of volume, admire the technological edge that Tesla has right now. Herbert Deiss, CEO of Volkswagen, has explicitly stated that Tesla is five years ahead of his company in terms of its autopilot technology. Deiss also said that the race towards the EV market is on, and the main element of the competition would be the battery technology, in which the entire car industry has heavily invested. Finding more efficient solutions would provide EVs with longer ranges with lower manufacturing costs.

Musk’s star status and Tesla’s rollercoaster ride in the financial markets and on the news have given it the reputation as the world’s most valuable car manufacturer in terms of valuation. This unique situation puts a huge burden on Musk and his team’s shoulders to capitalize on this success and to work hard to maintain and build on it. Investing in new factories, expanding its research and development capabilities, and raising the quality and safety of Tesla products would be a true embodiment of Tesla’s success saga.
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