Being the new kid on the block ain't for the faint of heart.
There is a lot of humming and buzzing going on at Tesla right now because the Silicon Valley automaker is ramping up for the unveiling of its biggest bet yet, the Model 3. According to Business Insider, cloudy days may lie ahead for the niche electric carmaker at the hands of the Model 3. They expect the entry-level luxury sedan to sell poorly because low gas prices will steer customers away from EVs. Besides, demand for sub-$40,000 electric cars like the Chevrolet Volt and Nissan Leaf isn't exactly high.
According to Business Insider, if the Model 3 is a complete flop, the company will survive because of the high 18% profit margin that the Model S yields as well as the promise of success from the Model X, sales of Tesla home battery packs, and the revamp of the Tesla Roadster slated to see light in 2020. While Business Insider has a point when it comes to gas prices and EV sales, they are overlooking the fact that buzz behind the Model S has allowed it to outsell highly established German luxury cars like the Mercedes S-Class and the BMW 7 Series. If Tesla can bring this same futuristic fun and tech-laden recipe to its new BMW 3 Series and Mercedes C-Class fighter, then they may just come out OK.