Elon Musk cofounded Tesla Motors, an American automaker, in 2003 and was among the first investors of the firm initially investing 7 million dollars and later adding another 30 million United States dollars (Rothaermrl, & Zimmer, 2014 p.2). Tesla Motors designs and markets electric cars in the United States. The main competitors of Tesla motors in the United States market are local firms General Motors, Chrysler, and Ford. Other foreign motor vehicle manufacturers that have entered and established themselves in the United States and compete with the local firms include are Toyota, Honda, Nissan, Hyundai, and KIA from various Asiatic countries; and major European manufacturers including Daimler, BMW, and Volkswagen and its subsidiaries Audi, and Porsche (Rothaermrl, & Zimmer, 2014 p.4). These foreign automobile manufacturing companies have over the years eaten into the market share of local firms, which as at the end of 2012 stood below 30 percent because of the quality, and fuel efficiency of these cars and other features.
The automobile market in the United States is currently not very attractive. Firstly, the number of competing firms in the industry has gone up to more than eleven firms competing in an industry that has high revenues volatility. Changes in customer tastes and preferences, changes in regulations, increasing input costs, and other factors contribute to the increases in costs while at the same time portending a situation that leads to a decline in the