Morgan Stanley Claims the Model X Will Rule the Premium SUV Market

Posted by at 4:32 pm on August 7, 2014

T Model X

Tesla Model X crossover electric car is going to outsell the company’s Model S sedan, and is “ready to feast” upon an unsuspecting premium SUV marketplace, says financial firm Morgan Stanley.

A Morgan Stanley report this claims that the much anticipated and delayed model X will be a better car and will deliver better sales to the Palo Alto-based automaker. Now the model X is not due to be in Tesla stores until the middle of next year at the earliest.

The value of Tesla stock, thus, should be about $320, well above its current $250, making Tesla “our top pick in US autos.”

It will also “sweep every Car of the Year award on offer by the automotive media,” the report said.

But wait, Morgan Stanley hasn’t seen or driven the X, just like the auto press  or anyone else outside of Tesla. But  Morgan Stanley say it is basing its predictions on “tangible facts”.

The first facts they use is that Tesla has more money and technical resources on hand to support the X than it did. It is also investing more time and money into the X launch. They believe this will put the crossover on the buyer’s driveway fewer bugs to correct than the S.  I know more that a few auto reporter who would change that thinking.

Plus Morgan Stanley epects the still un-priced X to have an MSRP of 5-10% higher than the S, which starts at $71,000.  They also think it will be more successful and provide better value, based on its assumptions that the car will have more standard features.   They Morgan Stanley loves the falcon doors on the X.  they do look great on stage, but ee here at ToT still question how well they would in tight cite garages.

The X could outsell the S by the end of 2016, the report said.

Now Morgan Stanleyhas totally gone over the deep in love wiht a vehicle they have never driven,  They did said, “It is worth noting that the commercial launch had been delayed by 6-9 months,” and added, “We are also surprised that Alpha and Beta prototypes have yet to be tested for what is a significantly new product.” The report said it expected Tesla would begin testing “in a matter of days.”

Elon Musk did make a little funny over the arrival of the X at his shareholders’ meeting last week.

“There are no cars available for a test drive,” he told analysts during a conference call. “There is no information about the cars in our stores. If someone comes in to buy the X, we try to sell them the S. We anti-sell them!”

moving past the his “joke”, Musk said, the appetite is huge, for a car that people have no reason to want.

“I think people are right — even though they don’t have the information to know they’re right,” Musk said. “We will not have a demand issue.”

Please note Morgan Stanley ended the report with disclaimers. The firm has a financial interest in Tesla, owns some stock in Tesla, has received payment for investment banking services from Tesla, and has received compensation for non-investment services from Tesla. But this is the case for them with many auto companies.

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