It’s hard to know how low oil prices will go, or for how long, but analyst and Tesla Motors enthusiast Jeff Siegel sees little risk for the electric vehicle giant as gasoline becomes cheaper at the pump.
Saudi Arabia “cannot shoulder price cuts for an extended period of time,” he writes, since the country “has its own economic issues to deal with, including some pretty burdensome unemployment rates.”
Even if low prices hit harder for less expensive EVs like the Nissan Leaf, “Tesla is at no risk of being sideswiped by cheap oil,” Siegel says. “Folks who can shell out $85,000 for a Tesla Model S don’t tend to be the types who worry about the price of gas. These are innovators and early adopters.” Which means there should be enough demand to keep Tesla going strong until its new gigawatt factory begins delivering cheaper batteries and cars.