Friends during COVID When other automakers Were struggling to be in the market And the Tesla is the only company That earns a profit of $721 Billion, in 2020 this company’s stock is increased by 740% If we see these things from the outside.
There are no automakers Who will challenge Tesla But the reality is not that if we look deeper This time Tesla has three problems that’s why the coming time will be hard for this company It could happen that Tesla can be out from the market. In this blog post, we will talk about. The three dangers which are surrounded, Tesla. So let’s start the Case Study.
You think that Tesla earns their profit by selling cars But you will get shocked The main profit of Tesla is not by the car selling But by the sale of Regulatory credits And it is the biggest threat To depend completely on.
Regulatory Credits From when the condition of Carbon emission got serious The government of some of the Countries orders the automakers to make electric vehicles In the form of Regulatory credits Because the electric vehicles Are come in the category of zero-emission vehicles Which does not affect the environment According to the rule.
Companies should make count ZEV’S For example if BMW, Ford, and Toyota are manufacturing 100 cars. Then among these cars, 10 should be Zev’s. If they can’t manufacture 10 Zev’s. Then they have to give a huge fine to the Government. If we talk about Tesla Which has all the Zev’s cars.
Means Zero-emission vehicles Because Tesla manufacture only electric cars If we see according to the rule Tesla manufactures 90 cars Extra than the other countries And for the extra Zev’s Government gives 90 Regulatory credits extra Companies like BMW, Ford, Toyota what do in this situation They but 10 Regulatory credits from Tesla.
So they can prevent from the fine of the company By this Tesla Sold their Regulatory Credits to the other companies Which is the full profit for it And these Regulatory credits are important to the Tesla You can predict that by this In 2020 Tesla earn $721 Billion of profit Because.
Because that year they sold the Regulatory credits of $1600 Million If Tesla didn’t sale those Regulatory credits Then they were in a very big loss This directly means that Tesla earns profit By the selling of resonance credit instead of selling cars And here is the starting of its real problem.
Actually the regulatory credit of Tesla is the best strategy for short term But if we focus on long term Then this strategy is harmful for Tesla Actually with the time Other automakers are Enter the electrical vehicles.
So that day is nearly soon When all the companies will make their goodwill in this And in this condition No other company needed to buy the Regulatory credits from the Tesla But Tesla Know this very well And they start work on it This is shown in their recent performance This is not the only problem.
Which they had to face Yet a big problem is raised for Tesla And for Tesla, this problem Is very important because This is connected by China Which is in one of the biggest markets of Tesla China is a country Which is known as.
The fast grower in the Electric vehicle market You will shock after knowing this The 41% share of Selling electrical vehicles Is in China In 2020 China growth 43% in the market This story of Tesla and China Started in 2019.
When the Chinese Government gives them permission to made Giga Factory During which Tesla become the first company who owns the 100% of it in China Instead of it the Chinese Government give a loan of $614 million To construct company And this is why this factory made a record.
And got ready in 160 days But in their own country America To build this factory they spend 2 years And this is not only Chinese government give 10% of discount in Taxes During this they Become the first company who got these types of discount In the COVID time, China government.
From providing mask to go and come from the factory, Hire a special bus and provides other services And that’s why in 2020 Tesla break its own record Deliver 5 Lacs vehicles Which increases the revenue of the company from $24.6 billion to $31.5 billion This is connected with China with 20% of shares You can calculate that.
How much the Chinese market is important for the Tesla If we see for Tesla This is running best more than expectation But after starting 2021, China show their real face In the starting of 2021 In the China the Tesla cars Factories got fire, not upgrade of software and the problems related to the Acceleration comes in front.
And then during March 2021 They accused to Spying and steal the data of Chinese citizens and sent to America This is because Because the automatic driving feature of Tesla Work on a camera system And the Government Review the security.
Which harm the image of the company And then In April 2021, During an Autoshow in Shanghai Suddenly a lady stand on her Tesla car Shouting That the brakes of Tesla is not working And the Chinese media which comes under the Chinese Government Share all the videos on the social media, That’s why this news Got viral in the whole world.
And because of this type of incidents Tesla getting hated by the public of China And the result is the sales of Tesla in China Downs 27% between march and April and 50% down between April and may In the China the sales of Tesla Start falling down The companies NIO and BYD Chinese rival companies.
Start taking advantage of it The growth of Tesla become less then The growth of BYD become increased by 119% yearly So the question is If China did this intentionally So what is the reason to do that And to harm Tesla, What is the profit of China So the experts say that there are two reason can be behind it.
The first reason is China is famous to steal The intellectual properties of other countries like Inventions, Design and technology So there are so many chances in this China wants to do like this with Tesla And the second reason can be Chinese government use the Tesla to introduce the Ev’s Revolution.
Because of Tesla the Chinese are Use electric cars And the Chinese company like NIO and BYD Increase their standard after Tesla In 2021 The thing happen between China and Tesla It affect the sales of Tesla In the coming time for Tesla.
The changing attitude of the government of the China to handle And to compete from the Chinese companies Will be a great challenge And with China In the Ev’s market of Europe and America Competition is increasing very fast And the market share of Tesla Is decreasing simultaneously.
And this thing is the third biggest threat for Tesla The Ford’s Mustang In February 2021, America the third most selling electric car This happened in February, Tesla Record growth of 5.4% Instead of this in the previous time In Europe.
The electric cars of Volkswagen Challenge Tesla And General motors also allowed that in the future They will increase their investment to $35 million In Ev’s All the giant automakers Start taking serious of Ev’s market And the thing which is important for Tesla is.
These companies manufacture cheap Ev’s And target those part in the market Which is not touched by the Tesla Because Tesla manufactures only premium cars On looking at these things we can say that The coming time Is very hard for Tesla And this is also interesting How the Tesla will solve these problems. Because Elon Musk is known to make possible Impossible.