Analysts at Barclays reckon Tesla Inc’s (NASDAQ:TSLA) early production problems with its new Model 3 electric car could deprive the firm of its ‘iPhone moment’.
Tesla – owned by billionaire Elon Musk – said last week that “production bottlenecks” were hampering the launch of its hotly-anticipated Model 3.
Like Apple Inc (NASDAQ:AAPL) had to do back in the day, Barclays says Tesla still needs to convince investors that aren’t “true believers”, adding that the issues might threaten the loyalty of those shareholders.
“There has been no shortage of investors (both true-believer-uber-bulls and those along for the ride) who have been bulled up on Tesla into the Model 3 launch as they believe Tesla’s ‘iPhone moment,’ in which the world appreciates the revolutionary potential of the product, will be realized by mid-2018,” the analysts wrote.
They go on to say that the Model 3 delays could push that moment back and give the likes of Ford Motor Company (NYSE:F) and General Motors Company (NYSE:GM) the chance to fight back.
“Amid production delays, it could mean that the Model 3 ramp could be dragged into 2H’18 or even into 2019, when the competitive threat will likely become more imminent,” Barclays said.
“And in the face of increased competition, the ‘iPhone moment’ appears less certain.”
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Oct 8, 2017 at 3:20pm PDT
Any significant delays or rise in competition would not only damage shareholder confidence, but also the share price, the analysts argue.
“Ultimately, we see risk that these production delays could negatively sway these [unconvinced] investors,” they wrote, though they expect any pressure at the moment to be short-term in nature.
Tesla shares were down 0.6% to US$355.59 in the pre-market.