BMW calls them the i3 and i8. They are, in reality, Tesla (NASDAQ: TSLA) killers, and worthy ones.
The i3, sells for as little as $42,000, which is about two-thirds of what a Tesla S does. Tesla wants to build a less expensive car. It will be priced at about $40,000. Both BMW and Tesla understand that affordability is an issue. BMW’s lead in this category could be a very important advantage.
While the pure-electric i3 cannot match Tesla in acceleration which is one of the attractions to Elon Musk’s cars, it does go from 0 to 60 in seven seconds, which is fast by most standards. It also has a number of the standard features which make a BMW a BMW. These include high performance brakes, stability control, and an dizzying array of electronics.
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The car Tesla should be more anxious about, for the time being, is the hybrid BMW i8. Its disadvantage is price — $136,000. However, it is blazingly fast — 0 to 60 in 4.2 seconds, and an engine which puts out 357 horsepower. BMW would be well served to produce an i-series priced between its two models-one which would give the Tesla S direct competition.
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BMW has one other, huge advantage — its dealer network. Tesla is forced to sell its cars direct to consumers. In several states, legislatures have blocked that approach, insisting all cars be sold through dealers. BMW does not run afoul of these laws. With a dealer network which is decades old, it actually embraces them
The all-electric car business is in its infancy. That is one of Tesla’s problems. It could have a dozen competitors from major manufacturers before the factory it wants to build to improve battery supply is completed. In the meantime, BMW not only has cars; it has its brand — a brand which makes it attractive to high-end buyers because it is among the most powerful brands in the world.
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