Tesla Motors Inc (NASDAQ:TSLA) is planning to increase its hold in the backup battery market, an area with huge investment and growth opportunities not only in the US, but around the world. In a program on CNBC, Bob Lutz, former GM vice chairman, said that tapping into battery industry is the correct decision by Tesla Motors Inc (NASDAQ:TSLA), but the company is not going well in the cars business. Batteries which are stationary and provide backup timing as an alternative to normal electric supply could be useful in many situations. Lutz didn’t appear much optimistic about Tesla Motors Inc (NASDAQ:TSLA)’s car business. He said that chances of Tesla’s car business growing around the world are slim. The revenue aspect of the car company is also shady. He thinks that if looked in comparison with the global car market, Tesla is still a small company.
Lutz said that whenever Tesla Motors Inc (NASDAQ:TSLA)’s CEO Elon Musk is asked about the core business of the company—which is the cars business—he quickly dodges this and throws another business idea such as batteries. He said that if he were a holder, he would stay away from Tesla Motors Inc (NASDAQ:TSLA) stock.
Lutz also didn’t agree with the idea that with lithium-ion battery production, Tesla Motors Inc (NASDAQ:TSLA) would gain a competitive edge over other companies. He said that lithium-ion battery production is a pretty straightforward, automated process, which any major company could start. The only problem in the production of lithium-ion batteries is the import of raw material.
Daniel Benton’s Andor Capital Management is one of the shareholders of Tesla Motors Inc (NASDAQ:TSLA), having around 1.25 million shares of the company.