Automakers everywhere need to be wary of this big, new kid on the block and its ilk. Tesla listed on the bourses only a decade ago, so one may not be amiss in calling it a relative newbie in the auto sector—remember Ford was founded in 1903 and Toyota in 1937.

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And this darling of investors, not less due to its outspoken founder Elon Musk, has returned a compounded 50 percent to shareholders from its listing price of $17 a share over the past decade. During the same period, Toyota’s ADR and the Nasdaq Composite index have returned a far more timid 6% and 17%, respectively.

Today, this green wheels maker is promising 400 miles on an electric battery and self-driven cars. These numbers are already unsettling global auto majors who are scrambling to emulate and transform into greener mobility players. In India, though, despite a lot of talk around EVs, we are far from putting any credible propositions on the road that can give the gasoline and diesel guzzling engines a run for their money.

The real and imminent danger on the horizon, is that Tesla and its ilk could do to mobility what iPhones and Galaxy handsets have done to communications. This especially once volumes ramp-up. And any protectionist measures to stave off this onslaught will only take us back to the Ambassador and Premier Padmini like era, which was finally disrupted by the now extinct Maruti 800.

Times change, and the wheels are turning swiftly, with Tesla’s founder now focusing on low-cost space travel to colonise Mars. To stay in the running with such rapid pace of innovation requires new thinking and a far swifter pace of transformation compared to anything seen before. And this is a definite worry while investing in home-bred automobile manufacturers in India, who are already losing market share to global peers—that sell about 7 of every 10 passenger vehicles today in the country.

Given the outsized gains possible on a scale-up, and with a possible break-even on the anvil, one expects investors will still feel better about investing in a Tesla today, despite the strong run-up in stock price, versus in a Mahindra or a Tata Motors.

First Published:Jun 30, 2020 5:57 PM IST