Morgan Stanley's overall volume projection for 2020 is about two thirds less than Tesla's 1 million. It doesn't expect net profitability under U.S. GAAP rules before 2019 and free cash flow generation until very late 2018.

Tesla's Model 3, base price close to $30,000 but probably averaging closer to $45,000, will go on sale by the end of 2017, and is charged with being a big volume success for Tesla, and its first serious profit generator.

Morgan Stanley said electric cars are now getting ready for prime time.

"EVs are no longer just a trend, they are a core strategy for (manufacturers) to address both increasingly stringent regulator targets," the bank said.

Late last year Morgan Stanley raised its estimate for battery-only global electric car sales to between 10 and 15% of the global market by 2025. That was more than three times higher than the average of current expectations then. Volkswagen expects this to hit 25%. Currently global market share is an almost invisible less than 2%.