Tesla Releases Its Patents To Fight Toyota And Hyundai

Jun. 26, 2014 11:02 AM ETTesla, Inc. (TSLA)HMC, HYMTF111 Comments
Matthew Levy profile picture
Matthew Levy


  • Tesla recently released its patents to everyone, but this perhaps will help attract automakers to the Lithium-Ion battery.
  • Thanks to the Gigafactory, Tesla can became the largest producer (and supplier) of Lithium-Ion batteries.
  • If other automakers adopt the Lithium-Ion battery, Tesla can use its growing network of charging stations to make an additional profit.

On June 12, Tesla (NASDAQ:TSLA) announced that it would open its years of innovation and developments to competitors and not sue anyone who infringed on their 100s of patents. That means that anyone can use the technology that took Tesla years to create.

As pointed out by the Washington Post, Tesla's open source approach reminds us how our patent system needs reform. Patents only last a set amount of time (approximately 20 years), and often it costs more to enforce them than gained in a legal victory.

While there is plenty of reform needed to the legal world, Elon Musk is taking a stand to bring that debate to the forefront while revealing Tesla's plan. Tesla's patents in no way secured it a large lead over its competitors. In fact, competitors to Tesla have been emerging in recent months, including VIA Motors and Harley-Davidson (HOG).

Harley Davidson recently released an electric motorcycle, while VIA Motors is offering electric alternatives to vans and trucks. While these are not direct competitors to Tesla's sedans, they do show the shift in attention to electric vehicles. Combined with Chevrolet's Volt (GM) and the Nissan Leaf (OTCPK:NSANY), the electric vehicle market is becoming crowded behind Tesla. With the availability of Tesla's patents to other electric vehicle manufacturers (who have more resources than Tesla), the gap should continue to shrink.

Tesla should be able to expand from their current market share in the high-end vehicle segment, though I do have my doubts about the Model E. We now know that its release is roughly one year away, however the extent of its success remains unclear.

With another year of EV advancement, it remains unclear what the competition will bring. In my opinion, however, Tesla will gain from the advancement of its competitors.

There are two major

This article was written by

Matthew Levy profile picture
"In investing, what is comfortable is rarely profitable." - Robert Arnott I am a "Value" and "Growth" retail investor, looking for opportunities in emerging and undervalued stocks, often counter to conventional thought. I use fundamentals to back up my argument, and also like to highlight stocks which I believe to be overvalued. I have enjoyed nice gains from using my strategies, finding value in everything from Research in Motion, SuperValue, ZipCar, and ClearWire to Apple, Netflix, Tesla and Google (before they all jumped 60% - 2000% or more). I have been actively trading for more than a decade, focussing primarily on stocks. With the privilege of having lived in New York for many years, I have attended multiple shareholder meetings, conferences and sector exhibitions. Over time, I have found that I am particularly interested in innovation - across every sector. Being a small business owner, I enjoy seeing first hand how certain companies directly affect consumers, for better or worse, by doing my own research through channels such as assessing website and store traffic, eBay and other 3rd Party Website sell-through, and customer satisfaction/feedback. There are always good investments to be made, and I try to find them by looking for a combination of growth, unique opportunity, and value - to both shareholder, and arguably more importantly, to its own customers.

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