The Tesla-Based Mercedes (as Seen Through Google Glass)
NEW YORK (TheStreet) -- The early bird gets the worm.
On a recent early weekend morning, I was out on the hunt for next-generation prototype cars. I was wearing Google (GOOG) Glass so I could react quickly and film a movie on a second's notice. Outside a Peet's coffee shop, I got lucky.
We all know Mercedes invested in Tesla (TSLA) a few years ago. This may have been the most profitable investment Mercedes has ever made -- investing in a competitor nonetheless.
Sadly, for Mercedes, it is also losing sales to Tesla. Now, I know, overall Mercedes is setting sales records in the U.S. over the last year. However, this overall statistic is masking some worrisome signs for Mercedes.Tesla didn't start shipping material quantities of cars until December 2012. Also, Tesla's sales has been disproportionately focused in and around its home area -- the San Francisco Bay Area. As I have reported on numerous occasions in the last half-year, the streets of Silicon Valley are littered with Teslas. Tesla's market share in Silicon Valley appears to be extremely high. What this means, among other things, is that sales of Mercedes S-Class must be down dramatically in this area. Tesla mostly competes with other $75,000-$115,000 sedans. I have not seen a single brand-new (newer than three months) Mercedes S-Class on the street in six months. If you're Mercedes, this is the canary in the coal mine. It's like the doctor telling you he's found a cancer in your tummy, and he's not yet sure if you have six months to live or six years. How can you do anything but panic, seeing this X-ray? Panic is what this driver did, when he saw me approach his test car at this early morning weekend hour. Here is the 10-second video I captured using Google Glass. Notice the silence. There is no gasoline or diesel engine in this Mercedes. It's an electric motor fed by a battery fitted into the floor pan mostly under the rear seat. Much of these new components were developed together with Tesla. The vehicle involved is a mini-minivan, a so-called Mercedes B-Class. It's a tall car, but short. It certainly isn't pretty, but I also wouldn't go so far as to say that it's butt-ugly either. As with so many other cars, it looks better in real life than in a picture or in a video.
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