On August 12, Karma Automotive--a Chinese car-maker--revealed its latest product: Revero, a plug-in hybrid sedan. If that description sounds familiar, it is because the American company Tesla has typically held the position of the prime innovator of such hybrid automobiles. This addition to the playing field is expected to cause some measure of competition with Tesla's famous Model S, which has continually topped sales since its introduction in 2012. It is the most successful plug-in electric vehicle for the past two years; it has even won awards for its design and engineering. In 2015, Car and Driver named the Model S the car of the century, praising it as "the all-electric dream car envied by many." A bold claim, now challenged.
Tesla Motors
The Revero is specifically planned to be advertised to the consumers of the Model S. It has a solar panel on its roof to charge its battery and can go fifty kilometers before switching to gasoline. It is one of the first to start applying solar panels to its products, something Mr. Musk wishes for future models of Tesla's sports sedans (Tesla's charging stations currently use solar power). Karma Automotive is, unlike other competitors, designing products with a cutting-edge angle, technologically speaking. It has taken Tesla's unique appeal and is applying it to its own business model.
These attributes--whether inherent or simply imagistic--appeals to consumers of hybrid vehicles. These vehicles themselves have a great allure as they are 'greener' and even more aesthetically pleasing on the eye, with fabulous colors and clean lines--a collection of tasteful attributes. Expense does play a critical role as well but Tesla factors in the average consumer's ability to pay when marketing and developing such cars. Mr. Musk has often commented that he views Tesla Motors as an independent manufacturer aimed at producing products for the average consumer--but Tesla is no longer the only one claiming to bring the latest four-wheeled gizmos to its consumers. And they are committed consumers, eager for choices.
Karma Automotive's CRO (Chief Revenue Officer) Jim Taylor described its core base thusly: "Those owners are so passionate, borderline fanatical...We want to give them first crack at it [Revero]." The same definition applies to Tesla's as well. They are one and the same.
The clash of Chinese and American businesses is only expected to increase in an increasingly globalized world, with each company aiming to one-up the other. The tactics previously attached to Tesla have now been co-opted by Karma Automotive, and the company is expanding. It has plans to open a new plant in Hangzhou, one of China's many industrial cities. How will Tesla compete now that its core characteristics are being adopted by competitors? Mr. Musk has much work to do on that front. Meanwhile, the Silicon Valley-izing of China is apt to continue.
