Electric carmaker Tesla (TSLA) - Get Report has a "near-monopolistic" opportunity to gain market share in the auto industry as traditional automakers remain complacent regarding electric vehicles, German investment firm Berenberg argued.
"(Manufacturer) complacency about electric vehicle (EV) technology is worse than perceived," Berenberg analyst Alexander Haissl noted. "Despite more talk of developing EVs for mass-market adoption, a lack of real action and strategic commitments betray their underlying conviction, with no clear pathway to high-volume EV production before the mid-2020s."
As a result, Tesla is left with the chance to dominate the market. And, while Haissl acknowledges the recent efforts from some legacy automakers to expand into electric vehicles, he argues Tesla will invest much more over the same period.
"To contrast Tesla with even the most forward looking (manufacturers), we estimate Tesla will invest $32.7 billion over the next 5 years - roughly 40% more than Daimler (DDAIY) and Volkswagen (VLKAY) combined have committed for their EV projects," he wrote.
Haissl also dismisses the notion that Tesla will have an inadequate battery supply, saying the company is out in front when it comes to high-volume cell-sourcing strategies.
What's Hot On TheStreet
Regulators outsmarted: With questions swirling whether its combination would get approved by regulators, Walgreens Boots Alliance (WBA) - Get Report and Rite-Aid (RAD) - Get Reportstruck a clever deal on Thursday. Walgreens will pay $5.175 billion to Rite-Aid in cash and receive 2,186 stores in return. Walgreens will also pay Rite-Aid a $325 million termination fee for its planned buyout of the company.
Walgreens will be an even bigger drug-selling beast, with more than 15,000 stores spanning 11 countries. As for Rite-Aid, it will be left with about 2,300 stores once the deal closes in six months.
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Editor's Pick: Originally published June 29.