Tesla’s $33 Billion Valuation Challenged by New Porsche Product

By Douglas A. McIntyre Published Sep 15, 6:10AM EDT

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Porsche has released a concept car powered by electric batteries similar to those used by Tesla Motors Inc. (NASDAQ: TSLA). While the Concept Study Mission E will not be manufactured anytime soon, it proves that a large ultra-luxury company can challenge Elon Musk’s cars, and probably soon will. While Tesla may not face an immediate rival, it will have trouble defending its extraordinary $33 billion valuation.

The Porsche concept car is fast: 0 to 80 in 3.5 seconds. It takes only 15 minutes to charge. It has a particularly long range of 500 km and is light with plenty of use of carbon fiber. Car experts and enthusiasts may argue that the vehicle is no better than the Tesla S P85D, which goes 0 to 60 in as little as 2.8 seconds and costs just over $128,000, but Porsche has several advantages.

Among those edges is it pedigree. Early versions of the Porsche were released in the 1950s. Porsche also dwarfs Tesla in revenue, posting over 15 billion euro in sales last year. And Porsche has a large dealer network while Tesla has almost none. AsTesla tries to get a foothold outside the United States, Porsche already has a huge one.

Tesla’s problem goes well beyond Porsche. Its success has drawn the keen attention of virtually every large manufacturer in the world, both at the luxury level and the mid-level of car pricing, to beat the Tesla Model 3 and its new Model X crossover. Porsche, for example, has been highly successful with sales of its Cayenne crossover, which ranges in price from $58,000 to over $160,000, spread across six models.

Tesla may keep its lead as long as another five years. However, large car companies have a way of turning concept cars into real ones quickly. That is when Tesla and its $33 billion market cap will be on the line.

ALSO READ: The Most Dangerous Cars in America

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.