Tesla Inc.’s (NASDAQ: TSLA) share price dropped as much as 25% last week and then recovered slightly on the last day of trading. It closed at $418, which still drove an extraordinary market cap of $390 billion. The range of price forecasts among analysts who follow the shares continues to be wide. At the uppermost point across the 32 people who have target prices, is $800 a share. At the bottom end, the forecast is $19, a drop of over 95%.

The 95% drop means that Tesla will suffer from withering competition. Its percentage of the electric car market will collapse. Huge manufacturers, led by Volkswagen, will seize electric car sales. As other manufacturers among the world’s largest pile into the sector with products comparable to Tesla’s. Their product management capacities, huge manufacturing facilities, marketing budgets, and dealer networks will give them strengthening leverage. Tesla will not be able to dodge an avalanche of electric cars, light trucks and SUVs.

The idea Tesla could be wrecked is not entirely far-fetched. Tesla has struggled like other car companies as the pandemic had rocked sales. After rapid growth in 2019, Tesla’s automotive revenue in the second quarter fell 5% to $6 billion when compared to the same period a year ago. Total vehicle production dropped 5% in the second quarter compared to the same period the year before to 82,272. However, compared to the first quarter, second-quarter production was down 20%. The COVID-19 economy was enough to ruin predictions Tesla would sell over 500,000 cars this year.

VW’s CEO expects his company will catch Tesla in electric car sales in the near term future. If VW sells 500,000 EVs, Tesla’s considerable lead in the sector will have been cut to nothing. Other large car companies can fumble their efforts, but among the world’s largest car manufacturers, some are bound to eventually get their EV businesses on an even enough footing to produce competitive products.

The pro-Tesla argument moving forward is that both its EV technology and autonomous driving systems will continue to outpace the industry. It also has a large base of car chargers, mostly across the U.S. That drives a level of convenience its competitors do not have.

However, real competition will put pressure on Tesla’s revenue, and also its EBITDA and cash position. It may need to return to the capital markets for funds. Each of these would be a sign that Tesla’s value, well above that of any other car company, is too high.

And there is a chance that competition will press Tesla’s market share down to a fraction of the market instead of the dominant position it holds now.

Tesla will never be just another car company. Yet, its sales could put it in a category close to that. The case that Tesla’s shares may fall 95% will have been at least partially made.

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