Tesla (NASDAQ: TSLA) vs. GM (NYSE: GM)

I doubt Elon Musk and the good folks at Tesla Motors (NASDAQ: TSLA) are shaking in their boots.

But that’s exactly how some auto analysts are framing the story of GM’s (NYSE: GM) newest electric car: the Chevrolet Bolt.

While gas prices are at record lows and electric car manufacturers are trying to reassure everyone that these “low gas prices” are not the new norm (and they’re right), electric car advocates are pushing hard in 2015 to showcase their latest offerings.

We already know that Tesla will have a new, competitively priced electric car in 2018. Dubbed the Model 3, it’s expected to deliver a 200-mile range, priced between $35,000 and $40,000.

This is the vehicle that management and most analysts are pinning as the catalyst that’ll take Tesla from high-end niche vehicle manufacturer to a mainstream manufacturer of cars the middle class can afford, too.

Now, it’s no secret that the holy grail for electric carmakers is a combination of increased range and affordability.

The increasing of range is well underway. In fact, Tesla just recently offered an upgrade to its Roadster customers that pushes the all-electric range of that vehicle to 400 miles on a single charge. But that’s also a $100,000 car.

This brings in the affordability factor. And every major automaker on the planet is focused on this.

The Tesla-Killer

In an effort to up the ante on electric car development, GM debuted a new electric car last week at the Detroit Auto Show: The Chevrolet Bolt.

CEO Mary Barra is hoping to impress buyers with GM’s own “affordable” electric car, suggesting a $30,000 price tag and a 200-mile range. It’s also been referred to as the “Tesla-killer.”

Given the lower all-electric ranges that exist today coupled with much higher price tags, certainly this will be a feather in GM’s cap. While the company’s plug-in hybrid electric vehicle, the Chevy Volt, sold respectably given the price tag and limited all-electric range, the Bolt could finally take GM up to the level of Tesla — at least as far as future affordability and range increases go.

But will that be enough to eat into Tesla’s projected market share of the first affordable electric car?

GM vs. Tesla

If all goes as planned, production on the Chevy Bolt will begin in 2017, and it will be delivered as a 2018 model. So basically around the same time Tesla’s Model 3 will come to market.

I suspect, based on how the Volt performed in terms of expected sales and market integration, that GM will be quite successful at marketing the Bolt. The $30,000 price tag and 200-mile range should also pull potential buyers off the sidelines.

Given the amount of time and capital GM has put into the Bolt (as well as its new lineup of electric and plug-in electric vehicles), the company will be fairly aggressive in pushing this thing. Complacency is not a road GM will travel if it’s serious about competing with Tesla.

That being said, it’s still hard to determine if customers will choose the GM model. After all, Tesla has built quite a reputation for quality and reliability. This has not always been the case for GM — even though the Volt received one of the highest customer satisfaction ratings for all GM vehicles on the market.

It’ll also be interesting to see how the performance of the Bolt compares to that of the Tesla Model 3.

Will GM be able to match what Tesla’s promising on speed and torque? And how about design? Tesla’s no slouch when it comes to producing an attractive vehicle. Will the Bolt have a superior design that’ll wow potential customers?

That’s hard to say. We just don’t know yet, and we can’t look at the concept design as an accurate illustration of the final product.

It’s definitely worth noting that if GM is successful and the Bolt sells, it could actually be a good thing for Tesla. This would mean a major carmaker has more of an incentive to help build out the supportive electric vehicle infrastructure, which is still in its earliest stages and mostly being developed by Tesla.

So really, no matter how the Bolt performs, Tesla’s probably still going to come out on top.

That doesn’t mean GM won’t benefit immensely by finally having an affordable, all-electric vehicle on the market. In fact, if the Bolt works out, this could actually be the starting point for a very successful series for GM.

And given the timing on delivery — towards the end of this decade — I would say GM is smart for moving on this while competition is limited to Tesla. At least for now, anyway.

To a new way of life and a new generation of wealth…

Jeff Siegel

Check us out on YouTube!

@JeffSiegel on Twitter

Jeff is the founder and managing editor of Green Chip Stocks. For more on Jeff, go to his editor’s page.

Want to hear more from Jeff? Sign up to receive emails directly from him ranging from market commentaries to opportunities that he has his eye on.