TESLA Motors Case Study Solution & Analysis

Tesla Motors Inc. is an US electronic and clean energy company car based in Austin, Texas. The current CEO is the South African-born Elon Musk. Their product range currently includes solar products, electric cars, battery energy storage from home to grid scale, and a variety of other related services. The current CEO is the South African-born Elon Musk. Get Tesla case study help from professional experts. Order for best case study services in Australia, Canada, UAE, US, UK and other countries. Our experts are available 24/7.

Tesla Motors Case study

Tesla Motors: A Business Strategy

Globalisation permitted organisations to gain access to new markets and to foster the flow of technologies and scientific knowledge. This can be leveraged to stimulate the manufacturing of cutting-edge products which can enhance peoples’ living standards. In the case of Tesla Motors, the organisation developed as a technologically advanced company, who significantly indulged into research and development to deliver the most sophisticated electric vehicles and batteries. Recent innovations in the motor industry centred on the fight against pollution, by developing more environmentally friendly electric vehicles.

Tesla Motors have outshone the rest by attracting motor enthusiasts with their development of electric cars that have enough torque and which run on green energy. Globalisation, on the other hand, has allowed the organisation to operate in different countries, thereby entering a more significant customer base. Globalisation and technological innovation have thus contributed to larger organisational successes. The motor industry is highly competitive and is typified by the presence of numerous well-recognised brands.

The evaluation of their five competitive forces

Power of buyers: Customers in the motor industry have a variety to choose from. This increases their bargaining power by dropping their switching Tesla Motors, on the other hand, attained a substantial competitive advantage by developing technologically advanced electric vehicles which are not available from others in the industry. This allows Tesla to increase their returns.
Power of suppliers: Vehicle manufacturers rely on raw materials supplied to them by supplier Suppliers providing quality components thus have a higher bargaining power. To reduce the dependence on suppliers, Tesla Motors have created their own battery factory that enables them to achieve vertical integration in the supply chain, thereby achieving higher competitive advantage.
Threat of new entrants: Barriers to enter the motor industry are relatively high. The high capital investment makes it difficult for new entrants. This secures Tesla position in that there is a low threat that new entrants will disrupt their
Threat of substitutes: Public transport is the direct substitute for privately owned Since the ease and benefits provided by a personal electric vehicle cannot be matched, this threat for Tesla Motors is limited.
Rivalry among firms: The motor industry consists of several well-established firms such as Ford, Opel, Volkswagen, Mercedes, Toyota, These brands are continually looking for new ways to nurture competitive advantage by developing new products with appealing value propositions. However, the product line of Tesla Motors presents unique products that offer both power and electric driving, without compromising the aesthetic appeal. As a result, this has made it quite attractive for customers.

The resource-based model discusses the value produced by the organisation, by using its resources and skills. An analysis has been done to assess the resources of Tesla Motors.

Valuable: The brand image is one of the valuable resources of the company. The organisation was recently valuated at $700 billion. This mirrors the financial position of the organisation. The patented designs and innovations of Tesla are also part of its competitive advantage.

Rare: The distinctive value proposition presented by the organisation, which includes a blend of aesthetic appeal, power, and electric drive train, is relatively exceptional in the industry. This assists to create a strong differentiation in the market and to gain more than average returns.

Inimitability: One of the key matchless resources of the organisation is the brand image and related brand elements, such as the brand logo and brand name. The organisation’s patents such as designs and technologies are also inimitable. They are viewed as the intellectual property of the company.

Organisational exploitability: Tesla Motors have effectively been able to control its existing resources to create a firm footstep in the motor industry, especially in the electric vehicle sector. As a result, this has allowed the company to attract many potential customers. The industrial organisation and the resource-based model has clearly highlighted that the company is able to produce above average returns.

Tesla’s mission is “to accelerate the advent of sustainable transport by bringing compelling mass- market electric cars to market as soon as possible.” The mission statement clearly indicates that the company has realised that the opportunities ahead is dependent on green and sustainable energy. This proactive tactic taken by the organisation has allowed them to take a first mover attitude to come up as a mainstream electric automotive organisation. It seeks to boost the evolution of the industry from fossil fuel to green energy and to try to stand in the front of the shift process.

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The vision of the company is to create the most compelling car company of the 21st century by driving the world’s transition to electric vehicles. Tesla Motors also pursues to grow its product line up to accommodate a wider demographic range of the population. Their vision also incorporates expanding the production of the lithium ion cells to reduce the energy cost and to make the world a sustainable place.

Thus, it can be stated that the company is trying to bring drastic improvements in the industry and to fast-track the growth of the electric vehicle sector and energy storage systems. This has improved the company’s potential to proceed towards its success and to create a strong competitive advantage in the market.

Impact of stakeholders

The stakeholders of Tesla Motors include the customers, investors, ecosystem, and the governments. The customers are offered products with unique and rare value propositions, which as a result will help the company to increase its sales. Thus, the customers directly impact the sales and consequent revenue generation of the company. The investors’ contribution to the company offers financial support and stability that is essential to maintain the sustainability of the company.

The eco system or the environment in which the company operates plays a significant role in its business. The mission of the company is to create a sustainable environment where the ill effects of fossil fuel-based vehicles on the environment can be reduced as much as possible. Thus, the existing deteriorating condition of the environment due to the pollution has encouraged the company to take major steps in the development of green energy-based vehicles. The government policies and regulations have allowed the company to run its operations in a favourable environment. Thus, it can be stated that the stakeholders of Tesla Motors positively contribute to its success and ensures it future growth and sustainability.

The case study highlights that Tesla Motors have successfully leveraged the influences of globalisation and technological advancement to generate a strong differentiation in the industry. The external environment in which the company operates has been assessed to be quite competitive in nature, but the strong competitive advantage of the company has fostered the creation of a strong brand image in the market to ensure its sustainability and growth.

ASSIGNMENT QUESTIONS

Read, analyse, and interpret the case study, then answer the questions below. The case study focuses on Tesla, Inc. Tesla is an American company. They are based in California, and they focus on electric vehicles and clean energy. Their product range currently includes solar products, electric cars, battery energy storage from home to grid scale, and a variety of other related services. The current CEO is the South African-born Elon Musk.

According to him, the predominant goal of Tesla is to move towards a solar electric economy away from a fossil fuel and hydrocarbon economy. To achieve this, Tesla must continue to build affordable solar panels and electric vehicles. Tesla has been chosen as the case study because it addresses a wide variety of strategic concepts that need to be considered when formulating an organisational strategy, such as globalisation, sustainability, return on investments, mission and vision statements, and their influence on success, stakeholders, and operations.

QUESTION 1 [15 MARKS]

Analyse the case study on Tesla and examine how strategy, strategic management, and strategic planning complement each other as part of the overall strategy of the organisation.

QUESTION 2 [10 MARKS]

Identify Tesla’s stakeholders, as well as the impact they have on the organisation and environment.

QUESTION 3 [15 MARKS]

Tesla is all about innovation. Identify all the different innovations from the case study and indicate how it influenced product development at Tesla.

QUESTION 4 [15 MARKS]

Search for the vision of Tesla in the case study provided. Analyse it by taking into consideration what researchers stated the criteria for a vision statement must be. Also search for the mission statement of Tesla in the case study provided. Analyse it by taking into consideration the criteria for a good mission statement. List improvements if you think it is necessary for both the vision and mission statement.

QUESTION 5 [10 MARKS]

In the Tesla case study, external and environmental factors were taken into consideration. Work through the case study and identify the external and environmental factors that Tesla Motors are taking into consideration when making strategic decisions.

QUESTION 6 [15 MARKS]

Identify the strengths that Tesla has accumulated within the organisation. Analyse their application of their strengths in building their brand and company.

QUESTION 7 [10 MARKS]

When reading the Tesla case study, what would you determine as their long-term goals?

QUESTION 8 [10 MARKS]

What would you consider to be Tesla’s competitive advantage, based on the case study? How sustainable is their competitive advantage?

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