When Toyota launched the Prius stateside in 2000, it had a negative profit margin, anonymous styling, zero winter traction thanks to primitive low-rolling-resistance tires. And most dauntingly, the Prius had big-name competition right out of the gate. Honda simultaneously opened its mighty Batcave and out came …. a tiny cockroach called the Insight. Well, even though the Insight proudly bore that trusted “H” on the front, it smacked of a rush job, a pre-term delivery that needed another few months in the Batcave, a science experiment that might have been spotted buzzing around Mass Ave. in Cambridge with a manic electronics professor behind the wheel. In short, it made the Prius look and feel like a Bentley by comparison. The Prius required far fewer compromises for similarly stellar fuel economy and green cred.
It’s now 2014. Toyota’s first-round advantage prevailed throughout this heavyweight match. Honda just announced it’s killing the Insight because the Prius has grown to a family of cars in three sizes and three excitement levels: low, lower and lowest.
Compared with the Prius at the turn of the century, the Tesla Model S in 2014 has similarly wayward competition — this time from BMW and GM, and is similarly pregnant with a family of sorts. Take those two ingredients and then add a heaping tablespoon of muscle-car EXCITEMENT to the green-car formula for the first time in automotive history, excepting the niche-bound Tesla Roadster, and you get an expensive indulgence without guilt.
But, say worriers, Tesla is no Toyota. It’s a mouse in a herd of mastodons. It can’t lean on more profitable models while the market digests the Model S. Tesla doesn’t even have household name status yet. Ask the man on the street if he’s ever heard of Elon Musk, and here’s what you’ll get.
* If the man is over 45 years old: “No.”
* If the man is under 45 years old: “No.”
* If the man is under 18 years old. “What grade is he in?”
But Tesla arguably has some advantages over Toyota circa 2000. First, it sells aspirational products that appeal to more of the brain than the prefrontal area of the frontal lobe. Second, it has much more government help, from the seminal loan to the ongoing tax credits to the Tesla ban in some states. Yes, bans help. Telling consumers they can’t have a product is the best possible endorsement and free publicity to boot, especially when a tag team of untrusted car dealers and politicians concocted the ban. And third, Tesla’s relatively small size could quickly go from disadvantage to advantage. Tesla is hyper-reactive. We’ve seen the company change its policies when “others were right and we were wrong.” And we’ve seen it issue over-the-air updates to instantly tweak its cars. Returning to my mouse/mastodon analogy, it’s not hard to imagine such a nimble mouse causing much consternation and even some mastodon injuries while it darts around their feet in the Model S, a.k.a. the new Prius, a fully-assed product among half-assed competition.
Now, regarding those upcoming Toyota and Honda fuel-cell cars …