Tesla and Europe: A Match Made in Heaven?

The Fool's own senior auto analyst, John Rosevear, sits down with Richard Engdahl for an in-depth look at Tesla (NASDAQ: TSLA) and the electric vehicle market, as well as Chrysler's unique situation with Fiat (NASDAQOTH: FIATY).

The economic crisis in Europe has slammed the auto industry as a whole, but luxury vehicles aren't doing so badly. Coupled with governments that tend to smile on green technologies, Tesla has enjoyed a warm reception Europe.

A full transcript follows the video.

Richard Engdahl: You mentioned briefly overseas sales for Tesla. It strikes me that Europe is perhaps a better place to sell electric vehicles. On the other hand, maybe the U.S. is a better place to sell premium vehicles. How does the overseas market look for Tesla?

John Rosevear: Well, on the one hand we look at Europe -- and particularly Western Europe -- there's a recession going on. New car sales in general are at terrible lows right now and the mainstream automakers in Europe are having a lot of trouble.

Enter Tesla that walks in. They're competing with a novel product in the luxury space. Luxury cars haven't actually done that badly. Go to a place like Germany, they're still selling plenty of BMWs and Mercedes and Audis in Germany. Britain is doing well. France is doing reasonably well, and the Scandinavian countries are doing fairly well.

I understand Tesla's had a really wonderful recession in, I think Norway. They sold a whole bunch as soon as it opened in Norway. It was like, "Whoa, Norway. OK."

With some of these European governments there's more support for electrification. There's more support for infrastructure. There are tax credits and tax breaks and so forth, because they want to move the country more in that direction.

We have some of that here, of course. We have the tax breaks, but we don't have quite the national support for electrification that you could do in a place like Denmark or something like that, because it's a smaller country and it can be done a little more easily, to set up that kind of infrastructure.

Engdahl: Is there any infrastructure -- speaking of -- is there any more government response to electric vehicles in Europe, as far as setting up charging stations and the like?

Rosevear: I'm not current on all of it. Some of the European governments -- the Western European governments -- I know Germany has done some stuff. I know that a couple of the Scandinavian countries have tried to move it forward.

The EU in general, of course, wants to push toward greener outcomes for motor vehicles in general, so there's some support there. The nature and specifics of it, I don't have that in hand.

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  • Report this Comment On October 20, 2013, at 1:47 PM, drax7 wrote:

    Norway tesla supercharging stations done very quickly, here due to permits it's taking forever. Come on John get with the program, don't let us down.

  • Report this Comment On October 20, 2013, at 9:09 PM, AjitC wrote:

    If Tesla can deploy the GenIII at $35,000 with a 200 mile range with superchargers at every 100 miles, plus the city chargers deployed by the governments, then they will sell in in huge numbers in the mid-segment. Besides incentives, the price of gasoline is around $8-10/US gal.

    Technically, I am confident that Elon can deliver the car with those specs. It may be priced higher may be in the $40,000 range to achieve the 25% profit margin. A 300 mile version in the $50,000 range would be the biggest seller, loaded with features. Range sells.

  • Report this Comment On October 21, 2013, at 12:16 PM, ffbj wrote:

    I suppose since there is a question mark after the headline it is more of a query, though I would place a period making it declarative.

    Gas is way higher as pointed out above. Europe is more compact, shorter distances to travel, and I would imagine the average commute is shorter, less range anxiety. In general I think Europe is perceived as more eco-conscious, and has less climate change denial.

    Better educated as a population than the U.S.

    Of course the average human is smarter than we-uns here in 'Merica.

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