Apple Inc. (AAPL) Has Its Ecosystem, Tesla Motors Inc (TSLA) Has Its Infrastructure

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Imagine taking any road trip in the U.S. without spending a dime on gas.

Thanks to Tesla Motors Inc (NASDAQ:TSLA), this reality is just around the corner. And this is the primary reason I think that bears are underestimating Tesla.Will Tesla Motors Inc (TSLA) CEO make Ford Motor Company (F) CEO Jealous with this Payout?

If you build it, they will come
Superchargers put other charging stations to shame. They are the difference between a convenient electric vehicle, or EV, experience and an inconvenient EV experience. These Tesla-owned charging stations juice the Model S roughly 16 times faster than most public charging stations — and they’re free.


Source: Tesla Motors.

A 50% charge in 20 minutes or an 80% charge in 40 minutes (at Tesla’s new 120 kW Superchargers), and Model S owners can be on their way. Even more, by the end of this year, Tesla Motors Inc (NASDAQ:TSLA) will be taking some stations one step further, giving Model S owners the option to pay about $50-$80 for a 90-second battery swap without even having to get out of the car.

“Faster or free?” Tesla likes to ask.

The value proposition is very real. Especially when you take into consideration the extent of Tesla’s Supercharger rollout. Earlier this year, Tesla had just 17 Supercharger stations. By 2014, the company plans to have 80% of the U.S. population and parts of Canada covered. By 2015, Tesla plans to have 98% of the U.S. population covered.


Tesla Superchargers planned for 2015. Gray and red dots both indicate Supercharger stations. Source: Tesla Motors website.

Currently, Supercharger stations are only accessible to Tesla Model S owners. Even more, the company hasn’t publicly announced any plans or partnerships to share Supercharger stations with other EVs.

In other words, Tesla Motors Inc (NASDAQ:TSLA)’s fast-growing Supercharger network currently serves as a meaningful competitive advantage for the company.

Ecosystems matter
When Apple Inc. (NASDAQ:AAPL) introduced the iPhone, the company had already built the world’s largest digital store. The digital store gave the new iPhone meaning. It gave it context.

Then, with millions of credit cards already on file, Apple Inc. (NASDAQ:AAPL) was able to introduce the App Store to customers already buying digital products from Apple, further strengthening its ecosystem. Once just a music store, iTunes has now expanded to become the world’s largest digital movie and app store too. The digital store reported a whopping $4 billion in revenue last quarter.

There’s little doubt that Apple Inc. (NASDAQ:AAPL) customers’ intense loyalty stems at least partly from this powerful ecosystem.

Tesla Motors Inc (NASDAQ:TSLA) is doing something similar. It’s building an ecosystem of Superchargers and service centers. It’s building the infrastructure needed to make EVs mainstream — just on time, in fact, for Tesla’s planned Model X launch.

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