The bell tolls about once a week for Tesla Inc.
And yet it’s worth noting that the threat of failure is real every time.
Tesla has been on thin ice since its founding. It was the only one of its peers to not only survive but thrive in a world that took its entire mission statement with a grain of salt.
Today, it’s credited as the catalyst for a new energy revolution, the sparking of an industry that had only been a theory previously.
But, as I’ve said before and will say again, Tesla may not win the race it started more than a decade ago.
Compared to its competition, it’s still a small company with small resources.
This has been proven time and time again, including earlier this week when the company reported that it had missed the mark this quarter in Model 3 deliveries, despite having a record period for the Model S and Model X.
The problem is, Tesla’s end goal has always been the Model 3, its “affordable” all-electric offering.
If the outlook for this car doesn’t improve, it may be curtains for this infamous EV company.
A Threat of Global Proportions
Given enough time, there’s little doubt that Tesla would be able to prove its mettle against the larger threat of gasoline-powered cars the world over.
But time isn’t something this company has in abundance…
First, because even its most stalwart investors simply don’t want to wait another decade for it to catch up to the rest of the vehicle market.
Even with the Gigafactory coming online in sections, Tesla’s production capacity lags way behind its competitors’.
If you’re not aware of just how big this divide is, take a look at how many cars these companies sold last year:
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Volkswagen: 10.3 million
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Toyota: 10.2 million
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GM: 9.8 million
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Tesla: 76,230
Tesla’s goal is to be producing 400,000 cars per year out of the Gigafactory by next year, a hefty if not downright impossible feat.
And it doesn’t get better, considering just how easily these major automakers could take Tesla out of the game for good.
You see, the market at large isn’t waiting for Tesla to catch up, either.
Almost all of the world’s biggest car companies have begun development, and even marketing, of their own EV offerings to compete with Tesla’s designs.
The Chevy Bolt is already on the market, going head-to-head with the Model 3 in terms of mileage, battery power, and price.
Volkswagen, Ford, Toyota, BMW, Daimler, and more either have their own EV offerings or will within the next two to three years.
The real kicker?
It turns out EVs may not even be the dominating clean energy force we all thought…
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The Best of Both Worlds
If you’ve been following the media accounts, you may have noticed an interesting new trend in transportation these days.
Companies aren’t really going “all in” on lithium-powered cars.
Instead, many are also looking to what could potentially be an even more useful technology in clean transportation: hydrogen fuel cells.
Just this week, General Motors announced that it would be investing not only in new battery-electric vehicle designs, but in fuel cell vehicles as well.
The company is already part of a partnership with Honda to pour as much as $85 million into mass production of hydrogen fuel cells for consumer vehicles starting in 2020.
Toyota, meanwhile, is still producing and selling its Mirai fuel cell car, one of the first such cars in the U.S.
Toyota has also been testing a larger fuel cell offering in the form of an 18-wheeler, which could eventually take on Tesla’s all-electric semi-truck.
It seems every one of Tesla’s ideas has a big-name challenger now.
As such, the lithium vs. hydrogen fuel cell argument is fast becoming an “anything you can do, I can do better” situation.
And it’s about time investors started taking notice.
Where’s the Potential?
These particular fuel cell developments, of course, can only move so quickly.
At least for now, unless you’re in California, you’re going to have a bit of trouble finding a fueling station nearby.
There are only 40 public hydrogen fueling stations in the entire U.S.
Compared to the ease of finding public charging stations, or simply buying your own home charger for your electric vehicle, hydrogen fuel cell cars today could be more of a hassle than they’re worth.
That won’t be the case for long, however.
In the following weeks, we’ll be digging deeper into where today’s hydrogen fuel comes from, how it goes from gas to vehicle fuel, and how companies are planning to expand the network to give hydrogen fuel cells a fighting chance in the transportation market.
Until next time,
Megan Dailey
@energyandcapitaMegan Dailey is a fresh young face on the investment scene. In her years as a research analyst with Angel Publishing, she’s learned that adapting fast to new investment situations is critically important to successfully navigating today’s volatile market. Her research has helped individual investors identify fast-growing companies in the energy industry that pay actionable investors back in spades. In an age of boundless information, her research is razor-focused on the most lucrative opportunities in energy and beyond. Megan’s research can be found in her weekly editorials on the Energy and Capital site. She also manages the Energy and Capital social media, and is always ready to answer your questions about energy investments via Facebook or Twitter!
