Former Tesla board member Steve Westly said the company is facing off against a lot of competition from other automakers that have dived into the electric-car market.
“Tesla is not going to be king of the hill in electric forever,” Westly told CNBC on Tuesday.
Westly was an early Tesla investor and has often been bullish on the company’s prospects, but said the electric carmaker will need to “double down” in order to fend off competition.
“They’re getting competition from all sectors,” Westly said, citing electric cars from luxury brands like Audi and Porsche, as well as less expensive vehicles from companies like Nio and Li Auto in China.
Several EV startups have also started to crowd the market. Lucid Motors, Fisker, and Rivian have already attracted billions of dollars in Wall Street investments.
“One could argue this indicates that, while Tesla’s appeal is clearly formidable, it’s not absolute and could be displaced by a worthy alternative,” said Stewart Stropp, senior director of automotive retail, in J.D. Power’s press release.
Despite Westly’s doubts, Tesla’s shares have risen more than 650% in the past year. The company’s revenue increased in 2020 from $24.6 billion to $31.5 billion, but it missed Wall Street’s fourth-quarter projections by 20%.
Tesla’s earnings have Musk vying for the position of the richest man in the world.
Tesla has long been working to compete with more affordable electric cars, as well as the Chinese market. Tesla plans to design a $25,000 car and has expanded its manufacturing plants into China’s lucrative EV market, building a Shanghai Gigafactory.
The company has seen success in China. In 2020, Tesla doubled its revenue in the Chinese market.