Who are Tesla’s competitors, really?

By Izabella Kaminska Apr 28, 2017 1:02 PM EDT

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Here’s an interesting point from Morgan Stanley equity analyst Adam Jonas on Friday regarding Tesla’s competitive stance in the market:

The good news: Tesla’s major competition likely doesn’t come from the world’s established auto companies.

The bad news: Tesla’s major competition likely doesn’t come from the world’s established auto companies.

Do you see where he’s going with this?

Out of the 30 names which applied for autonomous vehicle testing permits in April 2017, 11 were not established auto makers or suppliers. The most recent eight permits to the contrary were issued to non-auto technology-type firms.

What are the implications of this?

Well, the first is that non-auto players may have a slightly larger incentive to bring autonomous electric vehicles to market quickly.

But the second, simply put, is this:

Some of the tech firms listed above have well established business models focused on content or data (e.g. paid search) and thus could potentially offer a shared, automated, electric transport service at a loss just to get access to the vast quantities of data and consumer time. If Tesla gets to a point where it is offering its vehicles and/or mobility services in a region of the country or in a metropolitan area at a competitive price, there may be other very large firms that could offer a similar service at an even lower price due to the significant value those companies could extract from the vehicle and passenger data. Once again, time will tell if there is room for coexistence. But we believe today’s auto firms, in their current form at least, will have a difficult time competing along such lines.

Which implies tech corporations are mostly being inspired to reinvent the wheel and other existing technology just so as to better capture your data from you.

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