The company leans towards not only manufacturing electric vehicles, but also producing and selling components of electric vehicles such as Lithium-ion batteries. In 2008, the company produced the Tesla Roadster, its first all-electric sport car. The vehicle is a high performer and can drive up to 250 miles with the use of one lithium-ion Polymer battery pack, which has the capability of stringing twice the energy of a conventional automobile (Mangram, 2012). In addition, the vehicle is capable of accelerating up to 60 mph within four seconds and has a limited top speed of 125 mph. Another car option, the Tesla Model S, aimed at targeting the middle-class customers, starts at a much lower price when compared to the Roadster. The company has …show more content…
• Business level strategy: Tesla has a differentiation strategy focused mostly on the upper and the middle-class income levels. The company also aims at producing creative and high-performance electric cars.
• Cooperative strategy; Strategic Alliance:
The company has formed a partnership with many firms. Its R&D department has teamed with Panasonic to develop more efficient, strong and long lasting batteries (Karamitsios, 2013). In addition, Tesla Motors have cooperated with OEM producers such as Daimler and Toyota. The Toyota and Tesla cooperation intends to develop electric vehicles, parts and engineering support.
II. External Environment
Demographic
…show more content…
Recharging stations availability has provided a major opportunity for Tesla Motors development.
Industry Environment
Multiple Suppliers = Bargaining Power
Suppliers have a very high bargaining power because their goods are not those of commodity type. The company is limited to the amount of suppliers used in order to maintain its level of manufacturing. For example, more than 33 suppliers invested in the Tesla Model S in 2013. If Tesla is unwilling to pay a certain price demanded by one supplier, their manufacturing procedure will be handicapped. Therefore, suppliers are capable of setting their prices without considering whether or not Tesla is willing to pay.
Buyers Bargaining Power
Buyers have a low bargaining power due to the lack of similar vehicles available on the market. Tesla has positioned itself as a high priced company offering luxurious vehicles due to the high production cost and technological investment in R&D. The market demands do not much affect the market price. At times, Tesla is usually required to raise its market price to cover its costs to make
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 has confronted the market in an entirely unique way for the auto making business. Tesla plans to entirely bypass the dealer by providing vehicles directly to the consumer via the
The government is supporting the UN green initiative and is trying to reduce its carbon footprint and set targets to achieve a certain of CO2 emissions level, which requires an environmentally friendly means of transportation. According to the government draw up different laws are enacted to support the public in using electric vehicles. For example, tax cuts and free parking. This will attract people to buy electric cars and raise their awareness of environmental protection. These laws also determine the need for electric cars in the market, such as Tesla electric cars. As a result, Tesla's business has increased. On the contrary, Tesla has the opportunity to sell by direct selling, and many US states are allowed. However, considering that other government agencies do not allow direct sales, Tesla needs to be traded with vendors and
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.
The car market has been ran by companies such as Volkswagen, Toyota, Ford, BMW, and many other companies, but one of the newer, up and coming companies in this market is Tesla Motors Inc. Tesla has been around for a little over 10 years, and have come quite a long way from where they began. Tesla now sells luxury electric vehicles different than any other electric vehicles today, and they have big plans for expansion in the future. Tesla may not be one of the biggest car companies today, but one day they will be considered alongside companies such as Toyota and Ford.
The aim and vison of Tesla Motors is to provide in the short run cars which are affordable to the average consumer, it started making first sport cars for the enthusiast for speed and environmental preservation, moving then to the second phase to the large market who choses affordable compacts and sedans which in turn will promote and stimulate the electric car trend.
Our innovation topic is the Tesla Model S. The model S is an innovative car with many innovative features. The three features we are going to focus on are the HEPA air filter, autopilot and electric engine. Other cars manufacturers don’t possess these features in their cars making Tesla motors the first of its kind. Tesla 's Model S is expensive and ranges from $70,000 to over $100,000. It can reach up to 265 miles fully charged. Its competitor Nissan 's Leaf can reach a merger 75 miles. In the next couple of years, Tesla would like to manufacture affordable vehicles that costs $40,000 to $45,000 with the same technology as that of the Model S.
Tesla Motor Inc. first started off as a power-train designer, developer, manufacturer and distributor (Tesla’s mission, n.d.). Tesla’s engineers first designed a powertrain for a sports car built around an AC induction motor (Tesla’s mission, n.d.). The final product was the Tesla Roadster which launched in 2008 (Tesla’s mission, n.d.). Over the years, Tesla has sold more than 2,400 roadsters which operates in more than 20 countries (Tesla’s mission, n.d.). Currently Tesla is focusing on electric cars and that is where it is making most of its revenue. The first model of electric car that Tesla sold was the Model S. The model S base price is $70,000 and could go up to 1$05,000 for the P85D. In addition to the Model S, Tesla sells the
Tesla Motors was incorporated in July 2003 by Martin Eberhard and Marc Tarpenning, who financed the company until the Series A round of funding. Both men played active roles in the company 's early development prior to Elon Musk 's involvement. Tesla was founded in 2003 by engineers who had a mission to change the way the we thought of cars, and to convince our world that we can produce an electric car better than gasoline powered cars. In 1888 Nikola Tesla invented the first powertrain for a sports car built around an AC induction motor, which was later patented and inspired the company’s name. The Tesla Roadster was launched in 2008 with speeds of 0 to 60 in 3.7 seconds and with a range of 245 miles per hour. (Tesla Motors) Later in 2012 they launched Model S the first premium electric sedan. Robotic manufacturing of the Model S at the Tesla Factory in Fremont, California. Tesla manufactures the Model S in Fremont, California, in an assembly plant formerly operated by NUMMI, a defunct joint venture of Toyota and General Motors, now called Tesla Factory.
We design, develop, manufacture and sell high-performance fully electric vehicles and advanced electric vehicle powertrain components. We have established our own network of sales and service centers and Supercharger stations globally thus creating a unique business model in the automobile industry. We
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
Rarity: Tesla Motors is known to have a differentiated product over other firms in the sense that it sells electric based cars. It is the only successfully running electric sports cars in the U.S. At the beginning sales were not enough to sustain the business but tesla motors proved it self after introducing the new model, Tesla Roadster 2. There is only few car manufacturing companies trying to enter this industry which makes Tesla Motors have a competitive advantage.
In order for Tesla Motors to keep growing now and into the future, it is going to be important to expand their target market to reach more consumers. Expanding the target market to include generation Y (mid-20s to early 40s, middle class working adult), Tesla would be able to utilize their facility, while increasing production. This target market will be pinpointing the young professionals that are looking for an entry level luxury car. We are going to segment the market for our new targets in three categories: eco-friendly consumers, tech savvy and entry level luxury cars.
Tesla Motors Inc. was founded in 2003 by a group of engineers, one of whom is now the current CEO, Elon Musk. The company was founded on the ideals of not having to compromise to drive electric. These vehicles would be “better, quicker and more fun to drive than gasoline cars” (About Tesla). Tesla launched its first car in 2008, the Tesla Roadster. It is known as the first car to use a lithium-ion battery and revealed Tesla’s cutting-edge electric powertrain. Since then, Tesla has been able to expand with the Model S, Model X, and Model 3 (that has just begun production this year). Not only do they build electric cars but have expanded into scalable clean energy generation, storage products, and charging stations.
Unique position in automotive industry: there is public excitement for the vehicles Tesla manufactures. Tesla has a climbing interest among investors as that population continues to grow and the company’s value is increasing with the development of a sound financial strategy for future value. The intangible appeal of the Tesla car product is the high-value of a new company projecting market confidence.