BMW Now Considered a Threat To Tesla?

JUN 2 2014 BY ERIC LOVEDAY 20

BMW i8

BMW i8

BMW i3

BMW i3

Barclay’s Kristina Church thinks that there is at least one credible competitor to Tesla.  In Church’s opinion, that credible competitor is BMW.

Quoting Church:

“We think BMW have positioned themselves as tech leaders to out-rival premium peers such as Tesla.”

Church adds:

“In terms of positioning, Tesla’s target audience is likely sandwiched between the two i-brand models. The i3 may be smaller and with a lower range, but we think it will appeal to the same type of ‘sustainable’ driver as Tesla’s Model S, though may be a slightly less flashy one. The i8 is a higher-end, more expensive sports car. BMW’s emphasis on sustainability throughout the production process may appeal to a more deeply “green” consumer than Tesla.”

Tesla Model S

Tesla Model S

Church continues:

“In the near term, the i3/i8 may erode some of the base of Model S buyers; in the mid-term, BMW’s EV focus means increased competition for Tesla’s Gen III, reinforcing our view that Gen III success is not guaranteed.”

But then she loses some credibility with this statement:

“Combined with plateauing of Model S demand in the U.S. and Norway, we see incremental risk to the demand outlook for Tesla.”

There’s no concrete evidence to support this “plateauing of Model S demand in the U.S. and Norway.”  Tesla is currently in the process of fulfilling Model S orders in China, which is likely the cause for Model S sales volumes dropping off in some countries.  However, there’s no evidence that global demand for the Model S is falling.  In fact, by the global sales figures, it would seem that demand for the Model S is still rising.

What’s our take on BMW being a credible Tesla competitor?  Neither the i8, nor the i3 pose any serious threat to Tesla Model S sales.  Future BMW i models may indeed challenge Tesla head on, but with the i3 and i8, BMW doesn’t yet have a Tesla competitor in its lineup.

Source: Barron’s

Categories: BMW, Tesla

Tags: , , , ,

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20 Comments on "BMW Now Considered a Threat To Tesla?"

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Saúde to BMW for getting in the game, Tesla and BMW will learn from each other and will ultimately build the best BEVs. while others drag their feet.

Two things:

1) I am not sure how many “eco-buyers” cross-shop the i3 and MS. It would seem to me that folks would cross-shop the i3 against the Leaf, Volt, etc

2) The analysis highlights the difference in market segmentation between Tesla and pretty much everyone else. BMW sees the “i Series” as focused on a a specific niche (green buyers) and acts accordingly, while Tesla is chasing the performance sedan market with a car that happens to be a BEV.

O

Re: Tesla is chasing the performance sedan
Not sure this is true for the GEN III

Musk has said they are benchmarking against the BMW 3 Series, performance wise–we shall see.

O

LOLOLOLOL

I think the threat is better characterized by preference for BMW, as less green, actually. The wood panels don’t make up for an i-car engine. But an engine can make up for a more expensive Tesla battery. Who knows what a ~25kwh i9, 3cyl, could do? Getting inside the i3, and then some fond memories as we hopped into a 750Li, well, it was sorta different.

The i8 is a fast Volt. With a ridiculous electric range, I have a hard time seeing somebody asking if he should buy a Model S or a i8.

We have both an i3 and a Model S. Both are great in their own way, but not comparable. I have to admin that BMW is really doing their best with the i3. The i8 on the other hand is a step back and only made top lease petrolheads.

I kinda like the i3 but if thats their best, its not good enough….. I never expect much from BMW anyway….

You wrote, “What’s our take on BMW being a credible Tesla competitor? Neither the i8, nor the i3 pose any serious threat to Tesla Model S sales. Future BMW i models may indeed challenge Tesla head on, but with the i3 and i8, BMW doesn’t yet have a Tesla competitor in its lineup.”

At least you’re not afraid to counter the incessant posturing that BMW is the leader in EV’s, but I have to hand them credit to a FANTASTIC PR department.

It’s helpful to remember that the #1 group of buyers for the Model S are those coming from a Toyota Prius.
As the BMW i3, both BEV and REX, are closer in price to the Prius than the Model S, I think BMW will get a higher capture rate than Tesla of the millions of Prius drivers wanting to take the next step.

In that sense, if nothing else, the BMW i3 is a serious threat and competitor in market share to Tesla.

I am not more dumberer for having read the statements of this oaf from Barclay’s 🙂

Model S is billed as the “no compromise” EV, with a large range, large interior space – beautiful classical design.

i3 is a sub-compact with very limited interior space, Leafish range and fairly expensive.

Not sure they compete with one another, except in the way Model S & Leaf compete.

I should add – in the medium term, the only way BMW can compete with Tesla is by producing a 200+ mile range EV. They need to do that within the next couple of years – unless they have already been designing such a vehicle, they won’t be able to make it.

More likely, Tesla Gen 3 competitor will be a long range Infiniti, that will come out in 2016.

They have designed a long range BEV vehicle already – the i3.

All they need to change is the battery supplier in a couple of years – the same box but with double or triple KWh.

And then i3 is a real competitor to MS, eg for a buyer who wants “a premium BEV”. Not too many choices as of today.

The i3 isn’t really a “long range” ev. The range extender is only a “limp along” device that will get you to the next charging station–that is when there are “combo” quick chargers available. The RX cannot be manually operated, and only kicks in automatically at a pre-set low level SOC. It won’t charge the traction pack, just help maintain the SOC a little longer. It’s good for range anxiety, but not for really going anywhere far from home. It is good looking and drives nicely though.

I think the analyst was talking about competition in the sense of desirability and “coolness”, not specifications.

I’m really looking forward to see how Tesla will compare to other EV makers when they only have ~$40K per car to work with rather than $80-100K. That should be a fairer comparison with the i3 in terms of specs. Of course, by then BMW might launch an i4 or i5. I’m quite impressed by the miles/kWh efficiency that they were able to achieve through the weight savings of the carbon fiber-based body frame. Are there any efficiency advantages in Tesla’s electric drive train or power electronics that BMW cannot match?

The way I see the match up is the BMW is more desirable to some buyers because they have staying power. They aren’t going to go out of business if the i3 fails. Tesla, on the other hand, could fail if they don’t somehow sell a lot more cars (Model S or otherwise). Since the cost of the Model S isn’t likely to drop soon, they’ve got to convert to the smaller more cost effective model soon – or they’ll perish. It’s a real risk, despite all the praise and excitement, especially on a pro-EV site like this one. So, in the sense of a long term investment – the BMW i3 could be better. I’ve also thought that BMW has a more refined vehicle, BMW has lots more experience making vehicles than the Tesla, so their bound to have perfected the “fit and finish” a bit better than Tesla. Sure, the Telsa rocks on performance, but how often can you, safely, shoot around your neighborhood doing 6m/s^2 … it’s just a bit unnecessary. Besides, I think the BMW might be safer (I recall reading Tom Moloughney’s account of a bad accident in his Active E that partially crushed the… Read more »

By offering REx BMW essentially gave up on any eco cred. They said, they can’t make a long range EV and if you want longer range you have to buy REx.

I8 is competitor of Porsche Panamera PEV, not Tesla.