Honestly, Tesla challenge when it introduced the Model S was indifference. That's not the problem here. Tesla could be a game changer in the industry, like the iPhone was for the cellular business -- remember Nokia, anyone?
Tesla has a lot of competition (which is good) because it means there's demand for the product. The technology has been smoothed out with the S and the X models. Now the challenge is building 500,000 cars a year.
The car, with its 350 km range is more than sufficient for 90% of driver's requirements. In reality the average commute is 100 km per day (50 each way) so a 350km range should do the trick. Granted that's in ideal conditions still battery technology is moving very fast not only is it cheaper to produce, they are more performant.
The answer from the car industry: We're not worried, this is just a guy... that exactly what the CEO of Nokia said in 2007