Tesla, Inc (or previously known as Tesla Motors) is an
automotive and energy storage company which is based in the United States of
America. It was first founded in 2003 by Martin Eberhard and Marc Tarpenning
who were later joined by Elon Musk, JB Straubel and Ian Wright as co-founders.
The company’s main focus is: electric cars, lithium-ion energy storage and
residential panels (through a subsidiary company called SolarCity). Some
additional products that Tesla, Inc sells include Tesla Power-wall, Power-pack
batteries, solar panels and solar roof tiles.
The CEO of the company has a vision of Tesla as a technology
company which is also a fully independent automaker that is mainly aimed at
offering affordable electric cars to the average consumer. We chose this
company due to the fact that it is a company with a very broad market and
audience and an idea that is not so common in our day which would make the
research even more educational to us as a team.
Tesla’s mission, according to the chairman and CEO: Elon
Musk, is the same mission they had when they first created the brand which is “to accelerate the advent of sustainable
transport by bringing compelling mass market electric to market.” According
to panmore.com, in 2016, the company changed their mission from “to accelerate the worlds transition to
sustainable transport” to “to
accelerate the world transition to sustainable energy.” The update in the
mission statement tells us that there is a significant shift in the company’s
business which is to now market opportunities for renewable energy.
Tesla’s statement now has the three main components:
Acceleration: emphasizes on Tesla’s role in
creating a more diverse automotive industry towards more advanced technologies
for renewable energy.
The worlds transition: Tesla indicates
expectations of complete dominance in the “global market for electric
automobiles” according to panmore.com in which they also stated the direct
relation of the worlds transition and the impact they want to have on the over
all global market.
energy: the growing demand for renewable energy is now reflected on Tesla’s
business scope which is to cover products such as batteries and other
profitable renewable energy in the future.
Elon Musk recognizes that in order to achieve their end goal,
big measures and steps must be taken and leaps in technology are required which
automatically means a high level of scrutiny. Musk also believe that regardless
of the fact that new technology should be held to a higher standard, reasonable
limits to how high the standards should be should be established in order to
reach the level of success they aspire to be in.
Moving on to Tesla’s vision which states that it is: “to
create the most compelling car company of the 21st century by
driving the worlds transition to electric vehicles.” The company’s vision
statement focuses on four components and these are:
Most compelling: emphasizing the companies focus
on leadership and excellence within their industry. It indicates that their
main approach which aims to integrate advanced technology in its electric
automobiles and related products.
Car company: focuses on the company’s effort on
designing and manufacturing cars.
21st century: satisfies Tesla’s
leadership in electric vehicle design and production, it also implies the firms
use of technology to solve current concerns.
The world’s transition to electric vehicles:
talks about the company’s global goals.
A global company is a company which centralizes its
management (and most major decisions) in the home country, meaning activities
of the business are planned on a global basis but still operating with
international benefits from savings or economies on activities. Tesla, Inc is a
global company due to the fact that most business decisions and operations take
place in the headquarters and home country: California, USA. Tesla’s vehicles
and most of their products are produced in California but they do continue to
expand and make products more accessible and affordable to customers all their
costumers around the world.
Tesla has changed the automobile industry with the first ever
semi-autonomous technology offered in a commercial vehicle. The Model S and X
have now become the most successful models, as well as Tesla’s stock valuation
of $56 billion, served as a notable step in the industry, making Tesla an inspiration
to other companies to follow their foot steps. Five years ago the Model S
launched. There are still very few cars on sale today capable of delivering OTA
firmware updates. Tesla is, without a doubt, one of the most attractive environmentally
friendly on the market which also sets the standard for aesthetic when it comes
to electric cars.
Tesla, Inc operates in a highly competitive market. The
intensities of the external factors responsible for the force of completion
1.Small number of firms operating
2.Aggressiveness of other companies
3.Lack of switching costs.
The small number of significant firms operating in the
automotive market limits the effect of competition on companies like Tesla,
Inc. However, these firms are aggressive in innovating and promoting their
products. The low impediments for customers to buy cars from other
manufacturers (low switching costs) further strengthen competition. This aspect
poses as a high-priority strategic consideration in the automotive industry
Tesla’s customers are the biggest factor that determines the
company’s sales revenues. Some external factors determine the bargaining power
of Tesla’s customers such as; low switching costs, moderate substitute
availability, low volume of purchases. Therefore, due to the fact that
substitution availability is moderate, there become a limit customers’
bargaining power against Tesla, but low switching costs reduce barriers in
Tesla customers’ tendency to purchase cars from other providers, this factor
imposes a strong force against the company and other competitors in the
automotive industry environment. The low volume of purchases reduces the
influence of customers on Tesla. Thus, Tesla considers the bargaining power of
customers a second-level strategic priority, based on the intensities of the
corresponding external factors.
Suppliers shape the industry environment by influencing the
availability of materials that firms need and that is why Tesla’s business
partly depends on the reliability of its suppliers. Factors such as: moderate
forward integration, moderate size of suppliers and moderate supply determine
the supplier’s bargaining power.
Tesla’s suppliers have a low level of forward integration,
which means suppliers have limited control in the distribution and sale of
their product. In addition, these suppliers do not have much of an influence on
the automotive industry environment due to their moderate size. The suppliers’
moderate amount of supply has the ability to affect Tesla, but to a limited
degree only, thus, Tesla indicates the bargaining power of suppliers as a
secondary strategic priority.
Move Fast. Speed
affects Tesla’s competitive advantage, thus employees are expected to be able
to respond rapidly to trends and changes in the market as well as having a
speedy response to current issues and challenges in the automotive industry.
Do the Impossible.
In developing cutting-edge products, Tesla must ensure that its corporate
culture encourages employees to think outside the box. Tesla embraces new ideas
and solutions, while also emphasizes the benefits of considering unconventional
Innovation is important for a company such as Tesla because it helps develop
cutting-edge electric cars and related products. Tesla rewards constant
For a company such as Tesla that has made a huge impact on
the automobile industry, there’s pressure to stay at the top with the need to
constantly come up with ways to better the industry as well as move it forward.
Its important for Tesla employees to adapt to its culture so that the company
maintains its position. Employees reflect the company no matter how small of a
job they have, much like cars even if a nail is not up to par the quality of
the car as a whole would decrease.
Personally, I believe Tesla’s cultural organization fits its
image well and sets standards for the type of employees they’re looking to
hire, after reading a few employees reviews I can confidently say Tesla treats
their employees with respect and encourages free-flow of information “There is a very open culture and speaking
to the management teams is very relaxed and easy going.” According to the
reviews I’ve read the organizational culture is being followed by employees.
As stated on the main Tesla website homepage Tesla’s mission
is to accelerate the world’s transition to sustainable energy, and I believe
with the organizational culture being practiced Tesla’s mission without a doubt
will be met in time.
A company like Tesla Inc has a unique SWOT analysis due to
the fact that it is not a very common kind of car (running on electricity and
-Safest and fastest car (Model X was announced the safest
and fastest sport utility vehicle according to gotabout.info)
-Efficient energy (due to the fact that it uses renewable
energy, it has become the most energy efficient car with gasoline fueled
engines convert only 19% of the energy, electric cars convert up to 62% of the
-Investors and partners (the company acquired strong
investors partners in the past couple of years with names as big as Google,
Daimler, Toyota and Panasonic)
-Limited manufacturing capacity (time-consuming to make a
delivery which usually takes up to one year)
-Lack of variety of choices
-Negative cash flow (Tesla has a big portion of debt with a
negative $455 million in its financial statement putting it in a vulnerable
-Self-driving features (Tesla has been developing the
invention of full self-driving upgrade options, though its not a 100%
self-driven, it is still expected that the new upgrades will be exciting to the
public according to Musk)
-Demand (the demand of environmentally friendly cars is
increasing daily due to the fact that it is cheaper to maintain an electric
-Concern (people are becoming more careful with the
environmental pollution and using carbon producing cars therefore are slowly
converting to more environmentally friendly cars)
-Price (prices are not attainable for most middle class
Americans despite Tesla’s efforts to become a more affordable and less niche
-Competitors (more and more companies are now producing
electronic cars, which results in an increasing in the number of new
competitors, e.g: Volkswagen and other close alternatives)
-Opposition (big companies expose a lot of threats to Tesla
due to their strong capabilities to be competent in the manufacturing and
So as we
said Tesla was founded in 2003 by a group of engineers who wanted to prove that
people didn’t need to compromise to drive electric – that electric vehicles can
be better, quicker and more fun to drive than gasoline cars. Today, Tesla
builds not only all-electric vehicles but also infinitely scalable clean energy
generation and storage products. Tesla believes the faster the world stops
relying on petrol and moves towards a zero-emission future, which is better. Ond one of the successful product
tesla have made is the Model S – which has become the best car in its class in
every category. Also Model S the
safest the quickest and Model 3 a low-priced, high-volume electric vehicle that
began production in 2017.
just the beginning. With Tesla building its most affordable car yet, Tesla
continues to make products accessible and affordable to more and more people,
ultimately accelerating the advent of clean transport and clean energy
would like to work in this company and be part of it because they are going to
revolutionize the auto industry, plain and simple. Working for Tesla would mean
working with a company that is going to have a significant impact on the world
and that is something I really want to be part of. Not only that, but getting
to work towards a common goal with some of the most talented people on the
planet would just make the experience a million times better.