Don’t Bring Blank Checks to the Chinese EV Surge
Just because capital is flowing in doesn’t mean these companies are the next Tesla.
What a first-mover advantage gets you: Tesla’s gigafactory in Shanghai.
Photographer: Ding Ting/Xinhua/Getty
The cash is flowing for China’s electric car hopefuls, and not because they’re making heaps of it – or vehicles. But what can you expect if Tesla Inc. is the industry pioneer?
Sucking up capital is reminiscent of Tesla’s trajectory (and arguably, ongoing path). But that shouldn’t justify this current frenzy. Elon Musk’s car venture had a first-mover advantage that the others never will. Through its 10-year journey as a public company, Tesla has mostly burned cash as it tried to sort out production processes. No one else will get that luxury, despite the money coming in.