Ch. 5 - Developing a Global Vision

Practically since the invention of the combustion engine the market of motor vehicles was grossly dominated by fossil fuel derived energy. The growth potential and economic success of a company producing nothing but electric cars could be perceived as marginal at best when up against the ubiquity of oil fuel based infrastructure, consumer habit, and the overwhelming insistence on putting our faith in the devil we know.

But before analyzing Teslas' global market initiative in steps and measures, it may be worth while to consider what exactly it is they are getting at. In the 1950's a geo-scientist named M. King Hubbert, published a theory known as Hubberts Peak Theory, that asserted that at some point oil production in the world will reach a peak, and perpetually decline there after. The consequences of such perpetual decline and depletion of crude oil resource would include exponential increases in oil prices, and shutdowns of many industrialized, oil-reliant economies. This worrisome idea caused the U.S. Department of Energy to request a report published as the "Hirsch Report on Peak Oil". Robert L. Hirsch draws on many sources to estimate when peaking will occur, and what mitigation efforts should be in progress to prevent economic collapse, as the report states, the year peak is reached, worldwide economic recession is expected to ensue. The real frighting part of it all is that most projections in this report point to the 2010-2020 decade as the peak reaching time frame.

Now, beyond good intentions and idealistic hopes of saving our planet and our society- this is a market driven world nevertheless. Despite being a young American company, Telsa Motors has been reaching overseas almost with its conception. To date, the company has stores and service stations across Europe, a market share development project as significant as it's local one.

Supercharger Plans

Alongside it's sales and service centers, the Supercharger program projects the infrastructure plans seen in the picture above to be completed by the winter of 2014. Stores, service centers and charging stations are also being implemented in east Asia and Australia, albeit in a slower pace. The bottom line is that the impending effects of the projected peak oil issue apply to all industrialized nations, greatest of which markets are the EU and North America, and a day will come where gasoline prices exceed those of champagne. Despite the ideology involved in being "green" in the current not-yet-imminent-but-mildly-worried world of commerce, the tables are soon to be turned, and those who have already established the alternative will prevail.    

While Teslas plans to expand markets into India, Singapore, and further Asian presence, they are met with the general economic issue of out times. Infrastructure for both production and product use, corruption, and poverty in the existing market, burgeoning though it may be, still do not support good FDI returns. Despite being one of the largest economies for luxury, China's population is primarily poor, a problem afflicting a majority of Asian nations. The integration of their electric vehicles require the preparation of infrastructure alongside sales- an unviable endeavor where the sections of the population that can afford to invest in such cars are so small. It is in my opinion that once proper infrastructure is achieved in Europe and the U.S., affordable models are introduced, and Asian markets have further time to stabilize, only then will Tesla have a reasonable capacity to enter into the Asian market and tap into the masses therein.

Whether ideology driven or a market advantage plan is the primary motivation, there is no doubt that in the case of Tesla, good for one will be good for the other.