This compulsory paper covers the most relevant aspects of strategies and strategizing at Tesla, Inc., with a focus on supply chain management, manufacturing services and technology. It supports to identify industrial drivers and leverage strategic opportunities effectively. The reader will learn how to formulate, synchronize, manage and control corporate strategy with regards to business models, goal orientation, environmental fit and stakeholders’ requirements. The reader will learn how to apply state-of-the-art innovation frameworks and techniques.
The electric vehicle market has captured worldwide consumer interest. This market segment was according to Kumar valued at $118.864.5million in 2017 and is expected to reach $567.299.8million by 2025, growing at a compound annual growth rate (CAGR) of 22.3%. Further claims that this rising interest rate is believed to be achieved because of an outperformance in regard to the conventional vehicle, since it provided higher fuel economy, low carbon emission and maintenance, convenience of charging at home, smoother drive and reduced sound from engine.
This market segment is still in its growing phase, since it must convince people that it will work and is practical. Therefore, the market for all-electric vehicles is globally small, at roughly 1% of total sales, but Tesla has been doing its part to double it. In late December 2018 (Business Insider, 2018) stated that Tesla, Inc has created a micro-monopoly. Nowadays, according to DeBord,, one of the biggest challenges of Tesla is to maintain the electric vehicle (EV) market they have created.
Table of Contents
1 Introduction
1.1 Tesla, Inc
2 Currently Executed Strategy
3 Identification of Opportunities and Threats
3.1 Macro-Environment – Pestle-Analysis
3.1.1 Political
3.1.2 Economic
3.1.3 Social
3.1.4 Technological
3.1.5 Legal
3.1.6 Environmental
3.2 Micro-Environment – Five-Forces-Analysis
3.2.1 The Threat from New Entrants
3.2.2 The Bargaining Power of Buyers
3.2.3 Threat of Substitution
3.2.4 The Bargaining Power of Suppliers
3.2.5 The Intensity of Rivalry in the Industry
3.3 Diagnosis of Opportunities and Threats
4 Industry Analysis
4.1 Resource and Capability Analysis
4.1.1 Financial
4.1.2 Technological
4.1.3 Physical
4.1.4 Research and Development
4.1.5 Marketing
4.1.6 Engineering
4.2 Diagnosis of Strengths and Weaknesses
5 Management Recommendations and TOWS-Matrix
6 Conclusion
Objectives and Topics
This paper aims to analyze the current market environment and strategic position of Tesla, Inc. to determine if the company's ambition to drive the global transition to electric vehicles is endangered. By evaluating external market opportunities and threats alongside internal organizational resources and capabilities, the study identifies strategic levers to ensure Tesla's long-term competitive dominance in the electric vehicle industry.
- Strategic analysis of the global electric vehicle market environment
- Identification of macro-environmental trends affecting Tesla via PESTLE analysis
- Assessment of industry competitive dynamics through Porter’s Five Forces
- Evaluation of internal resources, capabilities, and innovative potential
- Development of strategic management recommendations using a TOWS-Matrix
Excerpt from the Book
3.1.1 Political
Frue (2018) found out that one chance to support Tesla in its vision would be that the government has taken action to improve the development of electric and hybrid engines, which resulted in a loan of $465million from the department of energy (cf. Overly, 2017). The government is giving tesla the opportunity to strengthen its financial performance through incentives (Kissinger, 2019). This means that tax credits in the amount of $7.500 are offered for purchasing an ev. To entice customers to buy an electric vehicle, some states such as Colorado and Virginia offer state tax credits over $5.000 (weebly.com, n.d.).
Furthermore, Hanley (2018) states that Tesla is granted a free trade agreement in form of building a Gigafactory in china which results in lower costs, faster production and significant presence on the Chinese market. Lastly, Tesla`s competitive and intensive growth strategy (cf. Rowland, 2018), which includes market penetration is favored by the political stability of major markets (Kissinger, 2019).
Summary of Chapters
1 Introduction: This chapter introduces the growth of the electric vehicle market and provides a brief company history of Tesla, Inc. to establish the foundation for the research.
2 Currently Executed Strategy: This section details Tesla's business model, focusing on its unique direct sales approach and innovation-centric strategy to achieve market scale.
3 Identification of Opportunities and Threats: This chapter utilizes PESTLE and Five-Forces frameworks to analyze the macro- and micro-environmental factors impacting Tesla's operations.
4 Industry Analysis: This section deconstructs Tesla’s resources and capabilities, such as financial standing, R&D, and engineering, to identify key internal strengths and weaknesses.
5 Management Recommendations and TOWS-Matrix: This chapter synthesizes previous findings into a TOWS-Matrix to provide strategic management recommendations for Tesla’s leadership.
6 Conclusion: The final chapter summarizes the analysis and concludes by refuting the thesis that Tesla’s ability to drive the transition to electric vehicles is at risk.
Keywords
Tesla, Electric Vehicles, PESTLE-Analysis, Five-Forces-Analysis, TOWS-Matrix, Strategic Management, Innovation, Sustainability, Market Growth, Automotive Industry, Competitive Advantage, Resource Analysis, Renewable Energy, Corporate Strategy, Gigafactory
Frequently Asked Questions
What is the core focus of this research paper?
The paper examines whether Tesla, Inc.'s objective to lead the world's transition to sustainable energy and electric vehicles is currently at risk due to market competition and internal challenges.
Which key topics are addressed in the analysis?
The study covers environmental scanning, industry competitiveness, internal resource allocation, innovative capabilities, and strategic development frameworks.
What is the primary goal of this document?
The primary goal is to provide evidence-based strategic recommendations to help Tesla's management maintain its market leadership position.
Which scientific methods were applied in this work?
The author utilizes standard strategic management tools, including PESTLE Analysis for macro-environments, Porter's Five Forces for industry competition, and a TOWS-Matrix to align internal strengths/weaknesses with external opportunities/threats.
What content is covered in the main section of the paper?
The main section includes an analysis of the external market environment, an evaluation of Tesla's internal resources and capabilities, and a synthesis of these factors to derive actionable strategies.
Which specific keywords define this analysis?
Key terms include electric vehicle market, strategic management, TOWS-Matrix, PESTLE, innovation, competitive advantage, and corporate strategy.
How does the author evaluate the financial health of Tesla?
The author discusses Tesla's significant revenue growth and market share but highlights concerns regarding high debt, negative profit margins, and the ongoing need for capital investment.
What role does the Gigafactory play in Tesla's strategy?
The Gigafactory is identified as a critical physical resource that enables in-house battery cell production, economies of scale, and the ability to mitigate risks associated with international trade and material supply chains.
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- Sebastian Neumann (Autor:in), 2019, Tesla, Inc. and the world's transition to electric vehicles. Risks, strenghts, opportunities and strategic reccommendations, München, GRIN Verlag, https://www.grin.com/document/918398
