Tesla Motors Inc. (NASDAQ:TSLA)’s true value in the market continues to be questioned in the wake of oil prices plummeting to all-time lows. Analysts are already remaining skeptical about Tesla’s prospects going forward as more people continue to buy oil guzzlers that are viewed as economical at the current low oil prices.
Senior analyst at Northland Capital Markets, Colin Rusch during an interview on CNBC’s reiterated that Tesla Motors Inc. (NASDAQ:TSLA)’s prospects going forward look brighter than ever as more people will continue to buy electric cars regardless of oil prices.
“People aren’t buying this car for the cost difference they are talking about pact performance the user experience. The fact that it is an incredible car, and there are some environmental benefits, so there is some personal brand value to that,” said Mr. Rusch.
Selling more mainstream lower-end vehicles to many people remains the biggest challenge for Tesla Motors Inc. (NASDAQ:TSLA) at the current prices of its vehicles. There is no doubt that Tesla will always enjoy demand for its vehicles but to be able to address the mass market, it will have to give in, in terms of pricing. In November, the giant electric car company suffered its biggest setback on a 14% decline on presales attributed to the ongoing decline in oil prices.
Rusch views Tesla Motors Inc. (NASDAQ:TSLA)’s prospects going forward as more diverse and won’t be affected by oil and gas prices. The analyst was also quick to point out that there will be more added value on the company’s battery business going forward with the ongoing battery-plant construction in Nevada.
“Tesla’s addressable market is not just the transportation market but it is actually the larger power market. We have been talking about Tesla as a transform transportation company, but we really think about it now as a transform of power and Energy Company. That is selling premium products both into the transportation market as well as into the stationary power market which we think is just as big as the automobile market,” said Mr. Rusch.
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