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Can the Allure of Porsche Withstand the Tesla EV Shockwave?

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Porsche is one of the legends in the automotive industry and definitely a dream come true-workplace for many software developers or in the business sector. The more we say about it, the less it will be.

A strong legacy, always satisfying the consumer’s needs elegantly.

So, how far do we see it as a serious threat to Tesla’s EV kingdom? Can it be called a strong competitor in the luxury EV segment in the long run?

 Well, as per the latest patterns and trends report, it is very hard to say that Porsche is an imminent threat.

  • In 2021, if we compare Tesla’s sales with Porsche’s,  the former sold over 936,000 vehicles, whereas the latter only sold 302,000 vehicles. Still, now, Porsche is lagging in its ability to match Tesla’s output.
  • Still, Porsche launched only one electric model, the Taycan, whereas Tesla launched four high-volume models. The EV lineup at Porsche is quite limited.
  • If we talk about charging infrastructure, compare Porsche to Tesla, which has thousands of superchargers worldwide.
  • Tesla has spread its wings with different EV models across the globe, whereas Porsche is still very young in the EV domain.
  • Tesla became a mainstream brand in the EV model, whereas Porsche has much lower awareness among young, tech-focused buyers.

 However, we cannot say Porsche could not pose a threat to Tesla in the next 5–10 years in the luxury EV space. Well, after all, Porsche is the original market and cannot be underestimated as a strong contender. Don’t forget about its brand equity and corporate resources.

  • Porsche has an aura of brand prestige, exclusivity, and performance. Tesla still lacks it—I mean, not like Porsche—but with more EVs rolled out from Porsche’s production house, it could attract its affluent buyers more.
  • A decade of knowledge and historical experience with motorsports provides the credibility that Tesla needs to acquire.
  • VW, as its parent company, provides much-needed access to VW Group’s massive investments in EV production and technology.
  • Even Porsche’s well-established dealer network is quite advantageous over Tesla’s direct-sales model.

 But one thing is for sure: changing the mindset of the people to like the E-vehicle from what they experienced before is quite challenging. Will they have the same experience as they did? This is also questionable with consumer preference.

The consumer experience and buyer’s rejection, or the reasons they didn’t like it, are already available to Tesla, which Porsche needs to establish a strong position in the market.

  • Tesla launched multiple cutting-edge EVs with long ranges and fast charging. It shows Tesla is out-innovating Porsche.
  • Tesla achieved a “cool” factor image with younger buyers, firmly established itself as a desirable and aspirational brand, and also led the tech-savvy to enjoy the luxury product more than the traditional Porsche.
  • Porsche lacks the scale to compete in EVs because Tesla’s EV sells more than five times as many.
  • Elon Musk, known for his futuristic conversations about the future of cars and dominating the automation market, knows how to create buzz magic with each model.
  • Tesla’s market cap is 15 times larger than that of its parent company, Volkswagen Group, with much higher growth than VW itself.

The main observation is the position of Tesla as an esteemed advanced technology vehicle presented as a leader in the automotive world with a mission for sustainability. Porsche is a prestigious sports car maker, but the EV market is too risky to conquer fully.

 It is also surprising to see that an established premium automaker is not eagerly taking any aggressive strategies to ramp up its EV production range.

  • Taycan is the only model available as of now; compared to Tesla’s four models and the growing offerings from Audi, BMW, and Mercedes, it lacks depth.
  • Porsche’s slow pace is falling behind consumer expectations and demand and could hurt future growth and its tech leadership reputation.
  • Startups like Lucid and Rivian are moving faster to bring new long-range EV models than Porsche to meet the high-demand segments.
  • With government regulations tightening up in Europe and China, Porsche needs to speed up its EV production process.

Is it possible to think that Tesla can disrupt Porsche’s market completely? The key insights highlight that:

  • As per InsideEVs data, in 2021, Tesla’s Model S will outsell Porsche’s Panamera sedan. The Model S has taken over the high-end sedan space.
  • As per the Dandelion Research Survey, Tesla buyers are on average younger than Porsche buyers and are more tech-focused next-gen luxury buyers than Porsche’s older demographic.
  • As per JD Power 2021, data shows that 26% of Tesla Model S buyers were cross-shopping Porsche. An overlap in consumer consideration sets.
  • In 2020, Tesla topped the Consumer Reports owner satisfaction survey with a 91% score and exceeded the desired expectations.
  • Even though Taycan satisfaction and loyalty rates are very high, Porsche EV owners are still brand loyalists for now.
  • As per the Bernstein survey, around 31% of Taycan owners switched to Tesla, whereas only 4% of Tesla owners switched to Taycan.

 What does Tesla need to continue to outpace Porsche and maintain its dominance over Porsche in the future by replicating the same present result?

  • Tesla needs to push the envelope on battery range, fast charging, autonomous driving features, and software-defined vehicles to remain unique.
  • Tesla needs to focus on improving the fit-and-finish and outshine Porsche’s precise engineering and craftsmanship, which are hallmarks.
  • Tesla should mimic Porsche’s white-glove treatment of customers, i.e., personalized delivery and responsive maintenance support throughout the journey.
  • Tesla can improvise with limited-edition halo models, lifestyle branding, and timeless design to elevate Tesla’s position among luxurious customers.
  • Tesla needs to emotionally invest in customers to achieve brand loyalty and actively promote the brand among their networks.
  • Tesla also needs to focus on diversifying into additional segments to attract every customer demographic over time.
  • The prestige of the brand can be cultivated with strong strategic partnerships, high-profile influencers, and experimental marketing strategies.

 Well, honestly speaking, it is quite ambitious to outshine an established automaker with such a long heritage, but Tesla, with a combination of sustained technology leadership, model diversity, and a unique strategy, can achieve something, a purely remarkable feat for any tech pioneer.

 The challenge to achieving it is the ability to maintain the focus on the luxury market with Model 3 and Y.If Tesla loses its tech-savvy or cutting-edge technology image Or the problems associated with rapidly scaling?

Sources:- Tridens, Tesla, Greencars, INDIGO,History, The Economic Times

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