Hong Kong Has the Tesla Model S Itch
Hong Kong is on top of its fuel efficiency game.
While anticipation for Tesla Motors’ (NASDAQ:TSLA) Model S has been growing in Europe and Asia, drivers in Hong Kong are especially awaiting its release, evidenced by a Bloomberg report saying the automaker has already received hundreds of Hong Kong orders for its new vehicle.
Those numbers are part of the 21,000 Model S units Tesla CEO Elon Musk expects to sell this year. While the vehicle is already on sale in the U.S. starting at $69,000, it’ll be delivered to Europe and Asia in the winter, and its prices there will be disclosed in the next couple of months.
According to Hong Kong’s Transport Department, the city had 303 registered electric cars at the end of April; that number will likely double with the release of the Model S.
It has been a good year for Tesla so far. Its shares more than tripled this year, and with the recent posting of its first profitable quarter, the automaker’s CEO has been dubbed the “next Steve Jobs.” Nonetheless, certain investors are still leery about counting on the continued success of the electric car superstar.
Although the company’s share price has seen tremendous growth over the past year, estimates of five-year growth rates show other automakers, like Toyota Motor Corp. (NYSE:TM), having higher growth potential.
In order for Tesla to establish itself as a permanent fixture in the American automotive market, rather than as a niche brand, it’ll have to deliver on Musk’s promises, especially those surrounding the network of Supercharger stations. While he expects Tesla to sell 500,000 vehicles per year in the long term, the automaker will first need to meet its projections to justify the vehicle’s large price-to-earnings and price-to-sales premiums. Thus, from a profitability standpoint, Tesla still has a lot to prove.