Tesla Motors Inc (TSLA) Rally Far From Over: The Next Apple Inc. (AAPL)?

Tesla has also removed typical dealership franchises to make way for its factory-owned dealerships. These company-owned dealerships will be the primary point of contact with customers. Although the move attracted litigation in some states across the U.S., Tesla remains unmoved.

This similar approach has worked well for Apple, with its Apple stores bagging accolades on several occasions for being the highest grossing retail outlets in the U.S. I believe that a similar approach will also work well for Tesla. And more importantly, it will tone up Tesla’s already strong brand by enhancing customer loyalty.

With a strong brand, Tesla will be able to retain customers like superglue. What’s more, with a little incentive, it will be able to grow its customer base. In view of this, Tesla has already revealed that its Gen 3 model, expected to roll out over the next three to four years, will be 50% cheaper than the already successful Model S. This lower price point, coupled with the existing flexible payment plans floated by company CEO Elon Musk, will act as a great incentive to rope in more customers to the luxury brand.

Tesla leads, others ‘copy’

Innovative companies always bring new meaning to the popular mantra ‘lead and let others follow.’ Instead, the catchword morphs to something like ‘lead and let others copy.’ Apple’s past legal brawls with Samsung puts a breath of life into this little theory of mine.

The rounded edges, the home button, the icons, the coolness; there is no denying that this was all Apple. How come I can see it on my Samsung Galaxy? While the courts can best decide who copied who, the general public tends to believe that Samsung was on the wrong.

Something similar is happening to Tesla, though on a smaller scale. Hundreds of kilometers away in the east, Toyota Motor Corporation (ADR) (NYSE:TM) has added an interesting addition to its product pipeline. Introducing the iRoad; unlike Toyota Motor Corporation (ADR) (NYSE:TM)’s typical line of automobiles, this product will be a hybrid of a car and a motorbike.

The iRoad will be powered by 2 kw electric motors that will allow the automobile to cover up to 30 miles on a single charge. In addition, the iRoad is touted to save parking space. Although this automobile doesn’t make the cut as a luxury brand, it is candidly working on a similar selling point as Tesla; green energy and convenience.

Ford Motor Company (NYSE:F) and General Motors Company (NYSE:GM) have also in the past made notable moves to come out as more innovative. Both the bigwigs are in the process of developing app ecosystems for their cars that will ride on the whole ‘smartcar’ revolution that is progressively sweeping through.

Conclusion

Tesla is definitely making insurmountable inroads. Its growing brand is a reflection of the bright prospects that lie ahead. In the first quarter, its Model S came out ahead of luxury brands like BMW and Mercedes in the ‘luxury segment’ U.S sales, outperforming the BMW and Mercedes-Benz S-Class. Going by the company’s strong cash position, new found profitability, promising product line up, and strong brand, I can comfortably contend that the rally has not fully played out. It’s not too late to late to get onto this ship; greater gains lie ahead.

The article Tesla Rally Far From Over: Is This the Next Apple? originally appeared on Fool.com.

Lennox Yieke has no position in any stocks mentioned. The Motley Fool recommends Apple and Tesla Motors . The Motley Fool owns shares of Apple and Tesla Motors. Lennox is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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