Tesla (NASDAQ:TSLA) is the undisputed leader of the electric vehicle revolution, with a stock that is up more than 1,300% over the past five years. The company has four vehicle models on the road, is building new factories around the globe, and continues to develop complementary products, including its solar energy system, cutting-edge battery technology, and autonomous driving system.
The company, and the stock, has come a long way, but there are still challenges up ahead and companies with the potential to knock Tesla back a bit.
Here’s why three Fools believe Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL), Ferrari (NYSE:RACE), and Enphase Energy (NASDAQ:ENPH) are set up well to mount challenges to key parts of Tesla’s business in coming years.
The Google car could win the autonomous race
Lou Whiteman (Alphabet): A substantial part of the bull case for Tesla is built around its autonomous tech. Cathie Wood’s Ark Invest — in setting its ambitious $3,000 per-share price target on Tesla back in March — built its argument in part based on its expectations that Tesla in the years to come will be able to launch an autonomous robotaxi service.
Tesla may well get there, but there are a lot of other companies exploring autonomous driving that could get there first. Although Alphabet is more known for its Google search engine and YouTube streaming service, its Waymo self-driving subsidiary looks like a serious contender for the autonomous crown.
Waymo has taken a slow and steady approach over the years. But the company’s tech has progressed far enough that last year it signed a deal with what is now Stellantis (NYSE:STLA) to develop “Level 4” autonomous-driving commercial delivery vans.
Level 4 is not fully automated, but it is more advanced than the Autopilot Tesla currently has on the roads. And Waymo believes its system (which, unlike Tesla, deploys laser-based tracking known as lidar in addition to cameras for navigation) is safer than its rival’s tech.
I’m not an engineer and won’t claim to know for sure which company and technology will win out in the end. But Waymo has a lethal combination of a deep-pocketed backer in Alphabet, impressive auto-industry partners like Stellantis, and years of development experience to help make its vision of an autonomous future a reality.
If nothing else, Waymo is well positioned to provide Tesla with a serious challenge as the tech continues to develop.
The most profitable automaker in the world is (sort of) on sale
John Rosevear (Ferrari): If you think Tesla is too much — too hyped, too expensive, too overblown — then how about the anti-Tesla?
Ferrari isn’t exactly an anti-Tesla, of course. While its stock-in-trade is its jewel-like, high-powered (and thirsty) V-8 and V-12 internal combustion engines, the company is in touch with the reality of where the world is going. Ferrari already offers one hybrid model, the SF90 Stradale sports car,…
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