Tesla Motors, Inc.
) Model S was the third highest selling car in the luxury and
sports-car segment in California in the first half of 2013,
according to a report by the California New Car Dealers
Association. The sales totaled 4,714 cars in the first six months
) Mercedes E-Class and Bayerische Motoren Werke AG's BMW 5-Series
occupied the first two spots. However, Tesla beat
Toyota Motor Corporation
) Lexus GS and
) Audi A6. This is good news for the company as electric cars
still occupy a niche market segment.
Though Tesla has acquired a substantial market share for Model
S through its impressive design and enhanced performance, it has
a long way to go. Although the company sold 1,097 Model S cars in
Jun 2013 compared with only 8 cars in Jun 2012, its market share
in California remains negligible. This is partly because Tesla
has only one model in the market, while competitors have multiple
However, this problem will be solved to a certain extent once
Tesla's Model X hits the market next year. The company is also
launching a right-hand version of Model S soon.
These launches are expected to boost Tesla's market position.
However, even Model S is rapidly gaining market share. Tesla
delivered 5,150 Model S in the second quarter of 2013, which
surpassed its projection of 4,500 deliveries.
Sales are expected to increase further once Model S becomes
easily available in other parts of the world. Tesla is gradually
working toward this goal. The company recently opened an assembly
and distribution center in Netherlands, which will allow the
automaker to transport parts anywhere in Europe within 12 hours.
Tesla also opened reservations for Model S in China earlier this
Tesla's share price reflects its rising demand. The stock
gained 1.5% to close at $164.22 on Aug 26, when California New
Car Dealers Association's report was made public. Moreover,
Tesla's shares have recorded an astounding 385% gain since the
beginning of 2013.
Tesla currently carries a Zacks Rank #2 (Buy).
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