The benefits from being the new exciting kid on the block only lasts for so long, and electric vehicle market leader Tesla (TSLA) -) could use a revamping, according to analysts at RBC Capital.
Tesla is slow playing the rollout of its newest vehicle. CEO Elon Musk said he wanted to "temper expectations for Cybertruck" during the company's previous earnings call. Eventually, Tesla expects to produce about 250,000 Cybertrucks a year, but that won't happen until 2025.
But analyst Tom Narayan believes the Cybertruck, which officially begins deliveries of the electric pickup starting Nov. 30, is just the kind of shot in the arm Tesla needs.
He said sales of the stainless steel truck right out the Aliens franchise and its presence on the streets of America could provide a "halo effect... to reinvigorate the brand," providing a catalyst to improve sales of Tesla's other vehicles.
In fact, he believes the vehicle can have a similar impact that an iconic American muscle car had for one of Detroit's Big 3 in the 90s.
"We are reminded by the Dodge Viper, which was a low volume model for Chrysler decades ago, that many believe helped to reinvigorate the Chrysler brand," Narayan said, according to Morningstar.
Chrysler was on the brink of bankruptcy in the 80's, placing a distant third in a race against its Detroit rivals General Motors (GM) -) and Ford (F) -).
But when they debuted their two-seater muscle monster in 1992 it became one of the most popular low-production American cars, gracing the cover of seemingly every muscle car magazine for the next decade.
Chrysler eventually killed the brand in 2017 after 25 years of reaping brand recognition.
The Cybertruck could do the same for Tesla, with Narayan estimating that the vehicle has years of demand backing it.
"We expect conversion rates to be at or below the Model 3 conversion rate, but that is still enough for a few years' worth of demand" at Tesla's planned annual production of about 250,000, Narayan said.
The Cybertruck has reportedly drawn more than 1 million reservations since it was first viewed in November 2019.
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