Tesla May Need Advertising As New Rivals Rise Up

Tesla has been in a tight spot financially recently, with bankruptcy possibly in its future if it doesn’t improve in a span of 10 years. Many car companies are also starting to enter the electric car industry through reinventing some of their own vehicle product lines. Here’s why Tesla should consider advertising.

According to CNN, Tesla should consider going into advertising to keep up with the trends in the electric market. As Tesla’s sales decline and new rivals are entering into the industry, Tesla is expected to suffer losses as their rivals start advertising their own electric cars.

As of previous years, Tesla has taken a stance against advertising through letting people spread about their electric car’s quality through word of mouth. Tesla believes that money put into advertising should be used to develop and improve the vehicle instead. The Tesla Model 3 followed this business plan and has experienced some success. However, Tesla Model 3’s sales aren’t enough to fully save the company.

So far, many analysts believe that Tesla needs to drop this stance if it wants to hit its goals to prevent the company’s bankruptcy. C3 Metrics CEO Jeff Greenfield notes that Tesla does have a strong foothold in the industry as many know Tesla when electric cars are mentioned. However, Tesla needs to sell more cars to make their ends meet. "You got the first phase of early adopters. But it's no longer that first tier that you're interested in," the CEO said. "They don't have a choice. They have to advertise."

Tesla's rivals are piling up this year as companies like Volkswagen, Mercedes-Benz, Nissan, Ford, and Byton are currently developing and planning to release their electric cars soon. Once all of them come out, Tesla will have to work extra harder to get noticed or find a way to establish their own brand stronger to the public before their rivals release their electric cars.

As of now, Tesla needs to improve income in the coming years to prevent the foreseen bankruptcy by 2029. Following the Tesla’s supposed need for advertising, the company could start publicly pronouncing their products more with the upcoming Model Y. The new electric crossover SUV is expected to be released later this 2019 for its Long Range variants while its Standard versions are slated for early 2020.

If Tesla wants to push the upcoming car’s features and affordability, the advertising could definitely help them hit their target market for this car and hopefully help with their money issues.