NBA superstar Charles Barkley made a now-legendary comment prior to the US Olympic basketball Dream Team playing Angola in 1992.

“I don’t know anything about Angola, but I know they’re in trouble,” Barkley quipped. The US went on to win by 116-48.

Tesla isn’t the automotive equivalent of Angola, but at times I get the sense that General Motors considers itself the Dream Team: the car company that symbolises US manufacturing might.

Both Tesla and GM have been to hell and back since the financial crisis. Tesla nearly went bankrupt in 2008, but was saved by a last-minute funding round on Christmas Eve. And GM did go bankrupt in 2009, after being bailed out by the federal government.

Fast-forward to 2016, however, and Tesla has a market cap of $US40 billion and GM has been raking in cash for two solid years amid an SUV sales boom in the US.

While both companies have bounced back, there’s no question that GM is better positioned financially to compete in the mass market EV space.

Staggering cash burn

Tesla is burning through impressive amounts of cash as it gears up to launch its Model 3, the company’s first mass-market vehicle, later this year. Last week, the company announced a new capital raise, to get another billion in the bank as it commits to spending $US2 billion or more in 2017.

GM also spends plenty of money, but according to Dan Ammann, the automaker’s President, it’s bringing in a billion a month. What’s more, the company’s recent sale of its European Opel division, for about $US2 billion, means it can also reduce its balance-sheet cash cushion to $US18 billion from $US20 billion.

Being basically cash-flush means that GM can take some huge risks. And that’s what it did when it committed to bringing its own mass-market electric car to market a full year ahead of Tesla’s $US35,000 Model 3.

As with most major automakers, GM has been content to let Tesla get all the headlines while taking all the risk. Electric vehicle sales have been abysmally disappointing, making up only about 1% of the annual global market; five years ago, there were predictions that we’d be headed toward 15% to 20% by now.

Tesla’s own sales have steadily increased, proving that there’s solid demand for at least for Tesla electric cars, but it’s still delivering fewer cars in the year than a big carmaker does in a month. CEO Elon Musk has charted an ambitious trajectory to sell 500,000 vehicles annually in 2018 and a million by 2020. But the company is very far from achieving those goals.

With the Chevy Bolt EV — priced just under $US30,000 once tax credits are applied, with 200-plus miles of range on a single battery charge — GM has decisively stepped off the EV sidelines. From debut to production, which commenced last October, GM took about a year and a half to steal some of the Model 3’s thunder.

Tesla still has the sexy

In early 2016, I attended the reveal of the Model 3 in Los Angeles, and the prototype vehicles that we saw there were compelling: sexy, fast, and high-tech. Last week, we got our first crack at a few days with the Bolt, and while I’d be hard-pressed to call the boxy four-door hatchback sexy, it is fast, and it is high-tech.

As electric cars go, it’s wildly impressive, and evidence of what a giant carmaker can do in a short period of time when it throws all its muscle behind a project. (Ford did something similar in 2015 and 2016 when it rolled out its GT supercar at the Detroit auto show in January ’15 and won Le Mans with the machine in June ’16.)

To borrow Barkley’s line, “Tesla is in trouble.”

Not because it won’t get the Model 3 out on schedule and be able to collect on the nearly 400,000 pre-orders it has for the car. If anything, Tesla could launch the Model 3 sooner than expected this year, and because manufacturing automobiles is an industrial practice that has been perfected over a century, there’s good reason to believe that Tesla will be able to build thousands of Model 3’s every month, once the assembly lines in California get up to speed.

Tesla is in trouble because its balance sheet is precarious and its ability to raise additional capital is based on a growth story: what was a $US20 stock in 2010 is a $US260 stock today. Investors anticipate more growth as Tesla rolls out more designs and sells more cars. Thus far, the company has existed in, effectively, a market of one.

But it’s now throwing its most important vehicle up against a worthy competitor that’s already out there and — more importantly — being manufactured by GM, which can actually afford to lose money on it forever.

In Tesla’s current world, nobody really “cross-shops” its cars with anybody else’s because there aren’t any long-range EVs available, and Tesla’s cars sell for about $US100,000 on average. The Model 3, however, will be cross-shopped with the Bolt. And make no mistake, the majority of those cross-shoppers will go Tesla.

But the cross-shopping will be happening. And once Tesla delivers all its Model 3 pre-orders, it will have to continue to stoke demand for the Model 3 as it moves out of the realm of the early adopters. Accordingly, Tesla’s costs for each Model 3 sale will increase from where they are now, which is basically zero.

The Bolt is good — very good

There’s another reason that Tesla is in trouble now that the Bolt has hit the streets: It’s a great car. Motor Trend didn’t name it Car of the Year for 2017 for nothing, and it’s certainly a front-runner for Business Insider’s Car of the Year award for this year (we’ll be making our pick in December, so the battle is already set, possibly, between the Model 3 and the Bolt — stay tuned).

Due to the Bolt’s compact size, I found it more fun to drive than both the Tesla Model S and the Model X, but not the original Roadster, a much smaller vehicle. With a 0-60 mph time of just over six seconds, the Bolt is slower than every Tesla you can buy, and it has nothing like “Ludicrous Mode” on the top-of-the-line Model S P100D, which enables the Tesla to outrun exotic supercars.

But the Bolt is plenty fast for most people. And it also offers a responsive ride, a remarkably quiet cabin, and an infotainment and connectivity setup that, with GM’s OnStar 4G LTE connectivity, beats Tesla’s very impressive high-tech system. In New York City streets especially, I found driving the Bolt to be like riding a small, nimble, guided missile.

The Bolt doesn’t have Tesla Autopilot, the styling is pretty dreary, and GM hasn’t built a nationwide fast-charging network to match Tesla’s Superchargers (you have to rely on third-party providers, such as ChargePoint, and locating Level 3 high-speed charging can be difficult). But GM is preparing to equip some Bolts with experimental self-driving tech pioneered by Cruise Automation, acquired by GM last year. The rollout will happen with Lyft for ride-hailing, potentially later this year, and consumer applications could follow.

The bottom line, of course, is that there’s only one long-range EV that you can now buy for $US37,495 (in California and Oregon, with Washington, New York, and New Jersey coming online in the first quarter of 2017). And it’s a Chevy.

GM isn’t going to overwhelm Tesla with Bolt sales. I actually think the Model 3 will greatly outsell the Bolt once Tesla’s car arrives. However, it’s also possible that if the Model 3 is delayed or is slow to ramp up, Chevy will be preparing a mid-cycle refresh of the Bolt before Model 3 sales start to achieve some major momentum. In other words, GM will always be ahead, and the company — barring another massive financial meltdown — will never stop putting the Bolt up against the Model 3.

This is a type of competition Tesla has never faced before. For the first time, it will have to spend money to get people to buy its cars — and it can’t spend anywhere near as much as the GM’s of the world. (We should note, too, that Musk isn’t scared about GM arriving on the scene because if anything he wants more EVs on the market, knowing that he can’t accomplish his planet-saving goals by himself.)

The worrisome thing here for Tesla is that it’s been spectacularly good at bringing sexy, exciting, luxury electric cars to the world. But it’s been comparably terrible at mass-producing its vehicles, and although it’s dealing with that problem, using only about one-fourth of its total production capacity in California has to change. It’s also never had to advertise or market its cars in the same intense manner as other car companies. Musk can get more out of one tweet than Chevy can from a Superbowl ad. And it doesn’t cost him anything.

As Tesla grows, it’s being pulled away from what it does best, toward what it doesn’t do as well. This is a natural process of maturing as an automaker. Tesla’s biggest challenge, going forward, is to avoid being such a disruptive upstart in a 100-year-old business that it gets clobbered by the big, slow carmakers that just happen to be able to flip a switch and build hundreds of thousands of Tesla-like vehicles much faster than Tesla can build actual its cars.

Clearly, Tesla would be in less trouble if the Chevy Bolt were a bad car. But it isn’t. Teslas have always blown me away. The Bolt blew me away for different reasons. I just hope Tesla is prepared to take this into account.

This is an opinion column. The thoughts expressed are those of the author.

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