After years of anticipation, Tesla Motors Inc. (NASDAQ: TSLA) has released its affordable car, the Model 3. Based on earlier information from the electric car company, at one point over 300,000 people had signed up to get one. The car delivers on most of Tesla’s promises. That may build an insurmountable wall for the prospects of General Motor Co.’s (NYSE: GM) own affordable electric car, the Chevy Bolt, which has nowhere near the brand power or visibility of the Tesla 3.
Tesla delivered what most observers say is a hit with the launch of the Model 3. Early reviews are glowing. The base version of the car will go 220 miles on a single charge. Buyers can upgrade to extend the range to 310 miles. The car is fast and will go from 0 to 60 in as little as 5.1 seconds. The wait time to get one, the only potential Achilles’ heel for Tesla, is 12 to 18 months. As important as any feature, the Tesla 3 prices out at $35,000 for the base model, before incentives.
The Chevy Bolt has similar price point, with a base price of $37,495. Its range is 238 miles without a charge. The Bolt is fast, with a 0 to 60 time of 6.5 seconds. It has received a number of awards, which include the coveted Motor Trend 2017 Car of the Year. And Chevy may have an edge because of the size of its dealer network, which makes the car easy to test drive and offers ready places for repairs.
Tesla champions would argue that only a Tesla is a Tesla. The company builds, by many measures, the most advanced cars in the world. At least that is Tesla’s reputation. The cars are also perfectly safe and very highly reviewed by consumers. Its cars are also coveted, though most people could not afford the Model S, which carries a price of well over $70,000.
Chevy is in a foot race with Tesla. If Tesla reaches the point at which it can produce 100,000 Model 3 vehicles a year, the wait list problem will go away. Then Chevy will lose what may be its most important advantage.
Chevy sold 7,592 Bolt models in the first half of 2017. Tesla 3 sales are likely to overwhelm that sales pace in a few months.