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Unlike traditional automakers, which aggressively spend on advertising, electric vehicle giant Tesla, Inc. (NASDAQ: TSLA) allocates virtually nothing for this avenue of promotion.

Loup Funds' Gene Munster delved into the prospects of Tesla eventually warming up to ads and the likely impact on its margins.

Will Tesla Advertise? Tesla CEO Elon Musk is not a big fan of traditional advertising but has hinted recently that he prefers informational advertising that can provide potential buyers a better knowledge of Tesla products, Munster said in a note.

Teslas have sold themselves until now thanks to a tech-focused customer base that has formed a passionate community around the brand, he said.

Over time, as the uptake of EVs improves and more players enter the market, Tesla's market positioning will likely see dilution, the analyst turned tech venture capitalist said.

"Our best guess is that competition becomes more measurable in the next couple years and that Tesla starts advertising meaningfully in 2025," Munster said.

The company will unlikely to turn to advertising ahead of the period, given supply has been the rare limiting factor for growth rather than demand, he added.

The Margin Impact From Ads: Tesla's advertising will likely be a "slow lift" and end up below auto industry'sevels, Munster said.

As opposed to General Motors Company (NYSE: GM) and Ford Motor Company (NYSE: F), which spend about 2.5% of total revenue on advertising, Tesla will eventually spend about 1% or $1.5 billion of its revenue in 2025, the analyst said.

This, he said, would equate to about $400 per vehicle.

Taking out $1.5 billion in advertising expenses out of operating income, operating margins would decrease from 15.3% to 14.3%, according to Munster's projections.

The margin impact, therefore, is measurable, yet moderate, he said. Increasing advertising spend will likely weigh on Tesla shares given that margins are a big piece of the Tesla story, the analyst said.

"In the end, we see Tesla's advertising advantage as durable for the short to medium term."

At last check, Tesla shares were up 3.5% at $688.99.