Tesla Case Study Summary

Two parameters define Tesla’s industry competitive environment: what Tesla is today and what Tesla hopes to become in the near future. Today Tesla delivers an EV in the high-end luxury market ($70k+), but plans to deliver an affordable ($35K) small sized sedan in the next few years (Kaufman, 2015). The differences between Tesla’s current and future plans affect the threats and opportunities for potential entrants, industry competitors, and buyers in the near term and long term.

Tesla Motors is a global enterprise specializing in the design, production, and marketing of electric powered vehicles founded in 2003 by the young businessman, Elon Musk. Elon is well known for co-founding paypal, and now he amazes the world again with his incredible vision of Tesla Motors, and being the main product architect. Tesla Motors appeals to the environmentally friendly market, by currently being the only company to sell a zero-emission sports car. Tesla’s fundamental motive and selling point is producing only electric vehicles, as opposed to competing companies, producing a combination hybrid, or diesel car.

Tesla`s current objectives include creating a high demand for electric vehicles which ultimately will raise sales. This will be achieved as more awareness on the harm gasoline emissions cause on the environment is shown, and knowledge on electrical powered cars is gained. Tesla also plans to create customer loyalty with current customers and create customer referrals. Tesla will achieve this by continuing to have regular customer events, such as show rooms which display their new technology.

Tesla is an auto car company of the 21st century founded by Elon Musk, Martin Eberhard, JB Straubel and Ian Wright. The company also manufactures power walls and battery charging equipment. Tesla is well known for the production of its first sports car Tesla Roadster coupled with two other cars Tesla Model S and the current Tesla Model X. Elon Musk is the face of the company and has driven the company through odds building confidence among its shareholders and customers (Marcovici, 2013, p 45). The company’s’ shares are often overpriced, thanks to loyal customers and investors of Tesla. Musk’s vision of the company is to mass-produce electric vehicles at a low cost and capture the American market.

Tesla Motors are noted to have personnel with a unique expertise in their field of work. These individuals help in carrying out activities that lead to the great performance of the company. The various innovations applied by these people is what led to the better performance of the company. Elon Musk along with taking over the leadership of the company brought about his experience in the firm and this was to influence the future performance of the company. Elon masterminded the designing of the Roadster and also included the marketing of the ordinary vehicle in the goals of the company (Hunger, 2010). This was something which had not been done by those who were there before him and thus his

Founded in 2003 and based in Palo Alto, Tesla Motors is one of the leading high-tech automobile companies, which produce the fully electrical vehicles and powertrain elements. The company runs operations in 31 countries and hires over 6,000 staff around the world. Tesla Motors has an increasingly high growth rate, recording its revenues of 2,013,496 in 2013 (See Figure 1). Sales of its current model, Tesla Model S, reach about 22,300 at 2013, ranking the fourth among world electric vehicle (See Figure 2).

Tesla Motors is an automobile company that provides electric vehicles. It was founded in 2003, in San Carlos, California. Although Tesla was chosen to be the provider of the best innovative vehicles, its sales indicated that the company could not sustain in the business since the sales appeared to be not enough to compensate the cost of the production of the vehicles. By launching the new model of its car, Roadster, in 2008 Tesla sold around 2,450 vehicles. After announcing the Model S, the company started to receive approximately 12,000 reservations by 2012. This redesigned Tesla vehicles started to be delivered and received positive feedback. In addition to this model, the company began to work on the new one, Model X, to be delivered in 2014.

Financially, Tesla has been moderate with a market capitalization of $30 billion and about 25,000 cars sold around the world over the last three years (Niedermeyer, 2014), however compared to its competitors like Toyota and General Motors, this growth is small. Their most recent annual report shows a negative net income due to their high cost of goods and operating expenses. This is because the lithium ion battery used for these electric cars is a highly expensive product in which Tesla currently buys from an outside supplier, Panasonic. Tesla’s is considering building their own “giga plant” to start producing their own batteries and becoming their own supplier so that they can have control over the market price and their operating expenses (Putros, 2014). Tesla’s current market price is at $241 and seems to be growing strong as

Tesla Motors was established in 2003 by entrepreneurs Martin Eberhard and Marc Tarpenning. Today, Tesla Motors provides power train components for car producers, including Daimler and Toyota, designs and manufactures Model S, the first world ‘s premium zero-emission sedan that became the third best-selling all-electric car in the U.S. The company is worth more than $25 billion and has one of the highest growth rate in U.S. This success of the company is contributed to Elon Musk, the CEO and Product Architect of Tesla (Tesla, 2014), who has a very strong vision of company’s future.

This report will discuss the strategies that TESLA have used in order archive there goals. The report will be starting with a brief background and the main drivers and leaders for the company. Then the report will be talking about three strategic stages for TESLA also will discuss their intended strategies for the future.

Tesla Motors is a electric car company that specializes in cutting-edge technologies and creating new jobs. Right now, Tesla is in the process of making a new super-factory for electric cars in the US that will require over 6,500 jobs. This new factory and search for effective AFVs is why Tesla’s CEO Elon Musk expects there to be over 500,000 Tesla vehicles on the roads by 2020 (4). This optimistic CEO believes this because Tesla is creating stylish new electric cars that can go zero to sixty in under four seconds, has a top speed of 125 mph, and can go over 220 miles per charge. With a price tag at $69,900, this company is beginning to make cars that are approaching reasonable prices for consumers (5).

Tesla Motors Incorporated, an American company that designs, produces, and sells electric vehicles and their electric components, has become one of the fastest growing car companies in recent history. The company’s main goal was to start creating electric vehicles that were accessible and affordable to the public. Founded in 2003 and taking off successfully by 2009, Tesla Motors started selling the first mass-produced vehicle to use lithium-ion battery cells and hold a range of greater than 200 miles on just one charge. Along with building their own electric vehicle models, Tesla also builds electric powertrain components for vehicles from other automakers including cars such as the Toyota RAV4 electric vehicle. Tesla has begun to maximize

In the automotive market, Tesla has a unique position. Tesla offers innovative new technology to manufacture electric vehicles. While Tesla is not the only car manufacturer of electric vehicles, but it has hit the luxury remotely create and dominate the electric vehicle market. The market is clear from inexpensive electric cars, as well as the market for luxury gas-power vehicles. Moreover, Tesla has a strongly sales growth. Tesla has been rapidly increasing in the past few years, mainly due to public interest in its vehicles. In 2015 sales increased by 27%, an increase of 59 percent over the previous year. Due to global demand for S-type vehicles, which can promote sales growth. X-type vehicles orders in the first

Tesla focus on the high-end markets, because it has a high price which cause some consumers who want to buy fashionable, electric vehicles. Tesla motors started the production of its first vehicle in 2008 the Tesla Roadster. It already produced 4 different models of cars- 2 roadsters and the Model X and Model S. Between 2017 and 2020, it will start the commercialisation of its fifth car which is Model 3 or Red star (Kebede, 2014).

With any new product introduction there will be risks. The greatest risk is the possibility that the new product will fail. Fortunately Tesla will be supplying a product that consumers desire and they have built a company based on proven and well calculated strategies. Although it is unlikely that Tesla’s new product would fail completely, there are other risks that could be present during the new product launch. For instance, given there will be a new product, that is going to be produced on a mass scale for a large consumer market, there will be an increased demand on Tesla’s supply chain. With an increased demand on Tesla’s supply chain there will be additional administrative, financial and personnel risks. All of these risks will need to be addressed and planned for appropriately in order to be prepared.