Is Tesla Motors Turning Into the Apple of the Electric Vehicle Market?

Is Tesla Motors turning into the Apple of the electric vehicle market?
Is Tesla Motors turning into the Apple of the electric vehicle market?

Only six months ago there were really only a couple of names in the EV industry which were grabbing the attention of the motoring public, one of which was Tesla Motors. However, there have been some significant changes in the EV industry, with some of the larger automobile manufacturers now heavily promoting their goods and in some cases discounting their headline prices.

In many ways Tesla Motors is becoming the Apple of the electric vehicle industry by using its own specific technology and even introducing its own specific recharging systems. This has prompted a number of comparisons between the company and the mobile phone giant which is Apple and on closer inspection their strategy seems to be very similar.

Closed shop technology

The likes of Tesla Motors and Apple have spent billions of dollars on their own specific technology and their own specific in-house systems. While Tesla has licensed out some of its electric drive technology, the vast majority has remained in-house and the company has also released plans for a type of recharging system which will be specific to Tesla models.

Quote from ElectricForum.com : "Last week I setup an appointment for a test drive with the new Model S. I've seen the car, sat in it, and messed around with the display previously in the show room, and have been waiting for them to get a test drive vehicle locally so I can give it a spin."

There are great advantages in maintaining a closed shop strategy to current and future technology but there are also specific risks. We only need to look at the Apple iPhone and the massive media attention it receives every time a new model is released. The worldwide media literally pulls the new iPhone to pieces, we hear comments from the general public and very quickly an array of positive and not so positive comments make it onto the Internet. Maintaining your own in-house technology means that you have to stay one step ahead of the competition and your new updates need to be bigger and better than anything else before.

Creating a fan base

Perhaps one of the main reasons why the Apple iPhone, together with Apple's other in-house technology has been so successful, is because it has created a massive fan base around the world. Indeed, many individuals are now obsessed with their iPhones and other Apple technology and it would certainly take something extra special for them to look elsewhere.

Tesla Motors has to a certain extent already built up his own loyal fan base because it was one of the first electric vehicle companies to market luxury vehicles at what are perceived as reasonable prices. The company is now looking to enter the mass market in 2017 with an "affordable electric vehicle" and Elon Musk, the company's chief executive officer, will be hoping that an increasing fan base means that there will already be significant demand for this 2017 offering before it is even released.

The dangers of a closed shop technology

As we touched on above, the likes of Apple and Tesla Motors have spent billions of dollars on their current and future technology. The fact is, that when you have a specific niche area in the market and a growing fan base, many of which are tied to your products and your services because of incompatibility with other competitors, you have to be one step ahead of the game. So far these two companies have managed to remain ahead of their competition, in many cases light-years ahead of their nearest competitors, but it is a very difficult and very challenging strategy to pursue long-term.

Interestingly Elon Musk, who is friendly with Apple management, suggested that as and when Tesla Motors becomes part of a larger group (which he believes will happen in due course), Apple could be the perfect parent company due to its enormous cash pile and similar sales strategy. Now, would that be a match made in heaven, Apple and Tesla Motors under one umbrella?