Why Tesla Motors Inc (TSLA)’s Rally Will Continue

Peers like Toyota Motor Corporation (ADR) (NYSE:TM) know all too well about the implications of poor customer experience. In the 2009-2010 time frame, the Toyota Motor Corporation (ADR) (NYSE:TM) name became synonymous with recalls. Now, the problem seems to be re-emerging. Earlier in June, reports came out that the Japanese automaker had recalled 242,000 third-generation Prius vehicles worldwide over brake faults. Such cases are unheard of in Tesla and it is that good relationship with customers that guarantees long-term success.

Innovation

The fact that Tesla was able to successfully advance an electric car for the mass market was in itself a testament to the high levels of innovation at the company. It has now gone a step further to show us that innovation can be used to cut back on costs; not this layoff thing that we see Wall Street executives do all the time.

Wedbush Equity Research argues that the production cost targets for its Gen III vehicle are achievable. The research firm has keyed out Tesla Motors Inc (NASDAQ:TSLA)’s incredible battery strategy as a critical element in controlling costs for the Gen III. Its strategy, which is aided by Panasonic, will allow Tesla to reduce its costs relative to its competitors.

Conclusion

These three factors will steer Tesla to new share-price territories going forward. The rally hasn’t fully played out and Tesla is still far from its prime. It’s not too late to get onto this ship.

The article Three Reasons Why Tesla’s Rally Will Continue originally appeared on Fool.com and is written by Lennox Yieke.

Lennox Yieke has no position in any stocks mentioned. The Motley Fool recommends General Motors and Tesla Motors (NASDAQ:TSLA). The Motley Fool owns shares of 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.

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