It might come as a shock to many that Tesla might beat Toyota in car sales during a pandemic. It is a reality cross-verified by several automobile news sources.
Share of Tesla gained 5% hit giving the company a valuation of $206.5 billion approximately, in comparison to the valuation of Toyota at about $202 billion (CNBC NEWS)
This pandemic has changed lives and those who were proactive and risk-takers might rule tomorrow or become part of history. So in the automotive industry Toyota, the market leader, might get a tough time from a technology giant, Tesla ready to disrupt.
Analyzing the past we know that Toyota produces and sells in volume much greater than Tesla. It has sold 30 times more cars last year and has revenue that is 10 times higher. It is the largest business in terms of sales. So what might have gone wrong that its market value got 4 billion less in comparison to Tesla, a company still struggling with its 2015 goal for long?
The share price of Tesla surged this year, as investors developed an inclination towards electric vehicles. It seems that they have started believing that the future belongs to technology-intensive cars. This company that is the brain-child of Elon Musk has survived many losses for several years. But the year 2020 turned out to the year for the company as in the past three quarters it has generated consistent profits and even during this pandemic it had a great beginning.
When we analyze the car sales, Toyota still leads with this years beginning to March sales of 10.46 million units with revenue posted as $281.20 billion. Tesla with all the glitz and glamour was able to deliver 367200 vehicles in 2019 making $24.6 billion only.
So what makes us think that Tesla might beat Toyota in car sales during a pandemic?
It is because this pandemic is not expected to end soon, so we are talking about 3-4 years from now, with people still isolating. It will be a risk for driving with someone that might be a potential carrier of the virus. So people will incline towards buying a driverless car, increasing car sales of Tesla.
Electric cars on the other side will become common, because of oil price issues and ease of charging car instead of waiting in long lines to have the oil filled in the tank. The investor interest in Tesla might make it a household name.
Tesla is a rebellious company that has survived odd, the quality that has made Toyota survive for ages. But Tesla takes a lead as first-mover of technology cars, so the future belongs to it. Toyota has been into formal research and development that might take much time in implementing an idea. Tesla has a philosophy of showing the prototype early and working on areas of improvement.
So they might get the technology right first, and if so, their car sales will be sky-rocking.