Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Tesla Motors Inc (TSLA): Another ‘Green Car’ Startup Hits the Wall

The upshot: Tesla notwithstanding, sarting a car business is really, really hard
Fisker’s experience points to just how hard it is to launch a new automaker from scratch. While Tesla Motors Inc (NASDAQ:TSLA) is on the verge of a profitable quarter, thanks to near-flawless execution on an audacious business plan, Tesla Motors Inc (NASDAQ:TSLA) is really the exception that proves the rule.

The last automaker to be started from scratch and become an enduring presence on the global stage before Tesla Motors Inc (NASDAQ:TSLA) was tiny supercar maker Lamborghini, way back in 1963. Lots of ventures have been tried since then. But as Fisker’s experience shows, the obstacles to success are formidable.

Designing and building cars to modern global standards of quality, reliability, and safety is hard, as several Chinese automakers have discovered the hard way.

Securing the funding to take a car from design to production — a process that can take years, and require big investments along the way — and securing the necessary government approvals to offer the car for sale are also daunting tasks for anyone who isn’t an established global automaker.

So far, Tesla Motors Inc (NASDAQ:TSLA) has succeeded where Fisker and countless others have failed. But even for Tesla Motors Inc (NASDAQ:TSLA), a still-tiny player in an industry dominated by global giants, the challenges ahead remain formidable.

The article Another Green-Car Startup Hits the Wall originally appeared on

Fool contributor John Rosevear has no position in any stocks mentioned. Follow him on Twitter at @jrosevear. The Motley Fool recommends BMW and Tesla Motors and owns shares of Tesla Motors.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.