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Tesla is the market-leader and best-recognized brand in the electric car market. It has established itself as a must-have item for early adopters. While the car manufacturing industry has begun to pivot to sustainable eco-friendly cars to compete for Tesla's customer base, the company continues to be positioned competitively in the market. We used Michael's Porter's five Forces to conduct industry analysis and we selected, justified and recommended sustainable strategies that are consistent with Tesla 's mission and goals. The changing market and cultural environment is mostly accepting to electric vehicles, and potential customers are attracted by its innovation and design.
EXECUTIVE SUMMARY
Tesla, Inc. is an American automotive and energy-company based in Palo Alto, California (Fortune, 2018). The company was founded in July 2003, by engineers Martin Eberhard and Marc Tarpenning, under the name Tesla Motors, Inc. Tesla Motors shortened its name to Tesla in February 2017 and by 2018, U.S. sales increased from 48,000 to 182,400 (Automotive News, 2019). The company specializes in electric car manufacturing and operates multiple production and assembly plants in Nevada and California. "Tesla's mission is to accelerate the world's transition to sustainable energy and as the world's only fully integrated sustainable energy company. Tesla is at the vanguard of the world's inevitable shift towards a sustainable energy platform" (Tesla.Com).
Although the automotive industry is highly competitive, Tesla has positioned itself as the brand which offers pure electric, impeccably designed vehicles. Currently Toyota's Rav4 Hybrid and Prius, the Chevrolet Volt, and the Nissan Leaf are available in the market. Even though the market is growing, the threat of new entry is moderate because research and development costs are extremely high. For the same reasons the current threat of substitute is very low. Bargaining power of suppliers is high because Tesla relies heavily on its suppliers to manufactures its products. For buyers, bargaining power of buyers is moderate. So, this industry will be attractive for current players in the market.
Tesla's strengths are its second-to-none brand recognition and an increasing number of sales at a global level. Most importantly though is its Supercharger network which has no competition and is the functional equivalent of GM owning every gas station. Tesla's weaknesses are increasing operating costs and the productions costs...