SA Asks: Which automaker can take on Tesla in the long run? (NASDAQ:TSLA)

Can anyone successfully compete with Tesla (NASDAQ:TSLA) in the long run or is the company too far out front to beat in the EV market?

Investors looking for an alternative to Tesla certainly have many names to choose from these days, from legacy players such as Stellantis (STLA), Ford (F), General Motors (GM) and Volkswagen (OTCPK:VLKAF) to EV-centric automakers such as BYD (OTCPK:BYDDF) (OTCPK:BYDDY), NIO (NIO), XPeng (XPEV), Rivian (RIVN), Lucid (LCID), Li (LI), ZEEKR (ZK) and Polestar (PSNY).

Which brings us to our EV investor question of the day: Which automaker is best positioned to take on Tesla in the long run?

We asked Seeking Alpha analysts Victor Dergunov, Jonathan Weber and Bill Maurer to weigh in on the topic.

Victor Dergunov: If we’re discussing the best-positioned carmakers for global competition with Tesla in the auto market, we should look at several players. First, BYD (OTCPK:BYDDF) (OTCPK:BYDDY) from China sells about as many EVs globally as Tesla. Therefore, it offers substantial competition to Tesla in the lower-end EV market. We also have considerable competition from established carmakers, notably Volkswagen (OTCPK:VWAGY) (OTCPK:VLKAF), GM (GM) and Ford (F). However, the global EV market is massive and continues to expand rapidly. Therefore, we should have room for several players. In the end, it comes down to the most innovative and best products, and I believe Tesla remains well ahead of the pack.

Jonathan Weber: I believe that BYD Company is the best-positioned competitor on a global scale, despite plans for new tariffs in the US. BYD is massive in scale and grows at a nice pace in China and many other markets. It also has its own battery production and is thus less dependent on suppliers. BYD also has higher margins compared to Tesla, with a quarterly gross margin of 21% versus 18% for Tesla, which could be an advantage during the ongoing price war.

Bill Maurer: BYD is the obvious answer here. Like Tesla (TSLA), the Chinese leader has its own battery facilities, and it could easily be the global EV sales leader this year. With the ability to sell EVs up and down the price spectrum, and potentially having support from the Chinese government, this name could easily be selling several million electric vehicles worldwide in the next couple of years.