Whilst Car Makers Are Dealing With Their Legacy Baggage, Tesla Is Tearing Up The Future
Tesla quietly slipped past General Motors to become America's most valuable car maker by market cap earlier this week. For a company with just a few years experience and a handful of models to be so highly valued in comparison to competitors with centuries of experience of the automobile industry says an awful lot about the differences between the old and the new.
Tesla has unequivocally focused on building cars for a future which is not in the hands of Big Oil and Big Car. All-electric, cutting edge driver assistance and a business plan which embeds the car into a whole ecosystem of micro power generation and storage.
In contrast, GM has delivered a handful of EVs and PHEVs, but has predominantly focused on its range of traditional trucks, cars and SUVs.
Those vehicles may well be GM's bread and butter and keep volume high but what they don't do is anything for the perception of GM as a company with a future.
Cars like the Bolt and Volt do. And GM should be pouring all of its resources into vehicles like these. As should Ford and FCA.
As Generation Z-ers become potential car buyers, car makers need to have positioned themselves as the kind of companies they would consider buying from. In the same way Toyota's embrace of the hybrid with the first Prius has driven a whole different perception of the company among Millenials.
Tesla's lack of a legacy to act as an anchor has allowed it to occupy that position in current and future customer's minds. It's something that even the most forward looking of car makers has struggled with.
The size of these auto businesses makes them difficult to turnaround. However the number of brands that each of the car making conglomerates owns surely offers some opportunity to diversify.
Take FCA for example. It has the Lancia brand, which is entirely superfluous to day to day operations. Making that grand old name, one with a history of technical leadership, its vanguard into the a future world occupied by self driving, renewable powered motorcars seems like a logical decision.
VW has a plethora of options, brand names it has stockpiled over the years. Ford and GM too. It seems to me that dedicating at least one brand completely to the future, in competition with Tesla, is the only way that these car companies can avoid having their future stolen away from them.
Right now if you were asked which company was going to be the premier motor company in 2050 you could only realistically answer Tesla.
That's a statement that should written large in the boardrooms of Detroit, Stuttgart, Paris and Tokyo.