Presentation by Group no.18(Div.

B+C2)

Pratik Gawai (Roll no. 19103)

Rahul Nannaware (Roll no. 19104)
Rutuja Shinde (Roll no. 19105)
Samadhan Jagadale (Roll no. 19106)
Sebin Sunny (Roll no. 19107)
Avej Shaikh (Roll no. 19108)

TESLA Inc.
Company Profile

 Tesla, Inc. is an American electric vehicle and clean energy company based in
Palo Alto, California. Tesla's current products include electric cars, battery
energy storage from home to grid scale, solar products and related products
and services.

 Founded:1 July 2003, San Carlos, California, United States

 CEO: Elon Musk (October 2008--)
 Owner: Elon Musk (20.8%)
 Headquarters: Palo Alto, California, United States
 Founders: Elon Musk, JB Straubel, Martin Ebe Rhard, Marc Tarpenning, Ian
Wright
 Subsidiaries: SolarCity, Maxwell Technologies, Deep Scale · Hibar Systems
· SilLion.
Website, www.tesla.com. Footnotes / references. Tesla, Inc. (formerly Tesla
Motors, Inc.) is an American electric vehicle and clean energy company .
ORGANIZATIONAL STRUCTURE TYPE

Tesla has a functional or U-form organizational structure.

 1.Function-based hierarchy (most important)
 2.Centralization
 3.Divisions

 CLIENT PORTFOLIO :

 A portfolio manager advises clients on the purchase and sale of shares, derivatives or
other types of securities, and also buys or sells securities on behalf of the client.

 COMPETITORS :

 Li Auto (LI)
 Nio (NIO)
 Nikola Corp. (NKLA)
 Workhorse Group (WKHS)
 Canoo Holdings (CNOO)
 Lordstown Motors (RIDE)
Tesla Sub Division Offices & Branch
Stores
 Tesla Headquarters':

 Tesla main headquarter is situated in 3500 Deer Creek Road, Palo

Alto, California – 94304 Tesla has 12 other offices location's across
9 countries like USA, Australia, China, Germany, Hong-kong,
Japan, Netherlands, Korea, Taiwan.
Tesla Factory
 Tesla’s factory in Fremont, California is one of the world’s
most advanced automotive plants, with 5.3 million square feet
of manufacturing and office space on 370 acres of land.
Tesla Gigafactory
 Gigafactory in Shanghai , China (produces Model 3,
Model S and Model X cars)

 Gigafactory in Germany

 Gigafactory 2 in Buffalo, New Jersey (produces

Solar Roof)
Branches of Tesla

 130 stores

 As of September 2020, Tesla operates more

than 130 stores and galleries in the United
States, and has stores and galleries in 34 other
countries. It owns the stores and sells directly
to customers via the internet and in non-
US stores.
Tesla Mission & Vision Statement
 Tesla Mission Statement :-

 Tesla’s mission statement was “to accelerate the world’s transition to sustainable transport.” However, in mid-2016,
under Elon Musk’s leadership, the company changed the corporate mission to “to accelerate the world’s transition to
sustainable energy.”

 This new statement indicates a slight but significant shift in the company’s business, to
address market opportunities for renewable energy. In a way, the new corporate mission recognizes the relevance of
the firm’s batteries and related energy storage products in markets in addition to the electric vehicle market.

 Tesla Vision Statement :-

 Tesla’s vision statement is “to create the most compelling car company of the 21 st century by driving the world’s
transition to electric vehicles.”

 This corporate vision emphasizes the company’s focus on renewable energy. Specifically, the corporation addresses
the electric vehicle market as a major avenue for facilitating growth of the global renewable energy market.
TESLA INC.’s GENERIC
STRATEGIES
What “GENERIC STRATEGIES”?

 Refers to three alternative methods for a firm

to position itself competitively within an
industry.
 Cost Leadership
 Differentiation
 Focus
 First defined by Michael Porter in his book
Competitive Advantage (1985).
 Also termed as “Michael Porter’s Generic
Strategy.”
Application of Generic Strategies by
Tesla Inc.’s
 COST LEADERSHIP
 The company is already popular and therefore the production costs are declining.
 Tesla’s generic competitive strategy has shifted to broad differentiation.
 The declining production costs and increasing brand popularity has enabled the
company to broadly target customers in the automobile market.

 DIFFERENTIATION:
 Focus on Broad Differentiation
 Builds competitive advantage based on the development of products.
 Tesla focuses on “Environmental Friendly Technology”.
 Leads to attraction of the customers.
 Innovation, high quality materials, relationships.

 FOCUS:
 Mainly focused on the Uniqueness of its products.
 Also focuses mainly on early adopters in the high-end market for electric vehicles.
 Attracts Affluent/Early adopters.
Suitable Strategic Objectives to Ensure
Competitive Advantage
 For the improvement in Generic Strategies,
the Company needs to focus on these
factors……
A. To increase investment in research and
development (R&D).
B. To strengthen competitiveness by broadening
its market reach.
Tesla Grand Strategies
Tesla’s Intensive Growth Strategies
Tesla Ansoff Matrix

Within the scope of Ansoff Matrix, Tesla uses all four growth strategies in an
integrated manner.
 Market penetration

 Strategic objective:

“To grow the company’s sales revenues through aggressive

marketing”.

  For example, with aggressive marketing, the company

aims to rollout and sell more of its electric cars in the
United States. In this way, the corporation maximizes its
revenues from the markets where it currently operates. 
Product Development
 

 Tesla CEO in August 2020 announced that the company will focus on new
product development and product scaling.

 Tesla engages in new product development infrequently.(high cost of NPD)

 Long-term plan is to create a wide range of models, including affordably priced

family cars. This is because Tesla’s primary goal is to help accelerate the
transition from a mine-and-burn hydrocarbon economy towards a solar-electric
one.

 Currently, the alternative fuel vehicles manufacturer is working to develop semi

truck and pick-up truck, along with a range of energy storage products.
Contd…
 The company plans to scale the production of affordable models such as
Model 3 and Model Y.

  After the company has established robust production of all available

models, Tesla will begin developing new models that should be even more
affordable.

  Tesla is bringing to market some of those products and more

 Tesla Model Y- (unveiled in 2019, under production)

 Tesla Model S & X refresh(performance Improvement & new Interior)
 Tesla Semi( heavy-duty Electric truck) limited vol. production
 Solar Panels
Market Development
 The company gradually expanding its market reach worldwide by
establishing new offices and facilities. At present, the company sells in only
a handful of countries, but further international expansion is expected.

  Aspire to be global leaders in the automotive industry, with energy

solutions for the transportation and other sectors.

 The differentiation generic strategy enables market development by

creating unique products that attract customers when the company enters
new markets.   

“Entering Indian market would be a strategically appropriate decision for the

electric automaker, taking into account estimations that “India will become
the third-largest auto market in the world by 2020.”[
Diversification
  Tesla has used diversification strategy during past years.

 The company was started only as electric vehicles

manufacturer in 2003 and later changed its name from Tesla
Motors Inc. after purchasing solar company Solar City in
2016 to enter energy storage sector. 

 The alternative fuel vehicles manufacturer is expected to

further diversify when/if it manages to overcome its current
severe financial issues.
Geographic Expansion

 The Company’s plan to expand its market beyond North America, China, and Europe in
2018. In a tweet following that, CEO of Tesla Motors stated that he is hopeful to expand
his presence to regions like India, Africa, and South America by the end of 2019.

 However,the electric carmaker looked at entering the Indian market in 2017 but plans
were pushed forward. Indian customers reportedly made bookings for the Tesla Model 3
when it was announced.

 Tesla
CEO El on Musk had announced a two-year plan for the company. Constructing a
mega factory in Shanghai, China was planned in 2017.

 The company aims to begin producing its cars in a new factory in the country. Tesla also
planned to shift production of its solar roof to its new Gigafactory 2 plant in Buffalo,
New York, during the fourth quarter of 2017, which helped the company increase
installations significantly in 2018. Tesla started 2017 with about 5,000 superchargers
around the world which spiked to 7,000 by September the same year.
Research and Development
 The company’s R&D revenues focus to enhance battery quality and range
for electronic vehicles.

 Tesla’s development strategy for 2020 comes in two primary categories:

Headline-grabbing moves like launching the cyber truck or the Roadster
2.0, which the company claims that it accelerates faster than any
production car ever made and big bets are being made on its core vehicles,
the Models S, X, 3 and Y.

 Tesla reported in 2019 that the company is planning to convert a building

currently used as a warehouse in Fremont into a major new vehicle R&D
lab, a ‘Future Energy Reliability Lab,’ and a vehicle testing facility
focused on improving reliability.
Stability Strategy
  Pause/Proceed with caution

 Tesla is now doing fine and wants achieve robust production of existing products, to
introduce and develop new products it will need a huge investment in R&D but instead they
could test the ground before moving ahead with a full-fledged grand strategy, trying to
overcome previous losses as a result Tesla will be able to move on with growth strategies. So
it is just a temporary strategy.

 Advantages :
• Enables the company to focus on its new product .
• Gain Some Profit to overcome previous losses
• Focus on internal issues and enhancing internal processes

 Disadvantages:
• Possible loss of market share Loose opportunity for potential investments for a
growing industry

• Delayed to cope with the rapid technology changes

Strengths
 A Top Employer Company - Any organization is as good as it employs. In the case of Tesla Inc., it is one of
the key factors for the company’s remarkable success. Wall Street Journal reports that Tesla has emerged as
an ideal company for employees due to its diversity and innovation-encouraging culture.

 The Leading Automotive Company - Despite its issues, Tesla’s sales have only increased. It has become a
leading automotive brand for 2019, delivering 367,500 vehicles.

 Best in-class Electric Cars - The recent comparison shows that Tesla occupies the top three places in terms
of range. The Tesla Model S will get you the furthest – traveling up to 600 kilometres on a single battery
charge. The nearest another brand has got is the Opel Ampera, with a range of 520 kilometers.

 Tesla Dominates the U.S Electric Vehicle Sales - According to Statista, Tesla model 3 is the most sold
electric vehicle of 2019 with a sales number of 187,971. On the second position, Chevrolet Volt stands, with
155,477 cars sold. Where Tesla model S is again on the third position with a close call, having 134,392 cars
sold. In short, Tesla is topping the electric car sales chart.

 . Cross-sell and Diversification - Tesla has launched a comprehensive insurance program for its vehicles in
association with Liberty Mutual insurance company called as InsureMyTesla.

 Innovative Company - Tesla has a very high rate of innovation, (not to forget the recent developments of
world’s first fully electric semi truck and new sports car). Therefore, the market trust and expects the
company to develop competitive and profitable products which of course leads to substantial financial gains.
Weaknesses
 Manufacturing Complications - The higher standard of innovation, the greater will be mechanical complications and
production risk factor. Tesla faces continuous launch, manufacturing and production ramp delays while launching their
new vehicles and other products.

 Unable to meet demand might affect brand value - Due to highly experimenting and complicated procedures, Tesla’
might face an unbalanced supply and demand, unable to meet the production requirement. In fact, their delivery rate in
the first quarter of 2019 is quite alarming. The company has delivered 63,000 cars in the first quarter of 2019, which is
a 31% drop from last quarter of 2018.

 Lack of High Volume Production - There is no doubt that Tesla is the pioneer of actual energy-saving cars. But it has
failed to produce high volumes of automobiles for any of its models. Even now, as the company plans to manufacture
Model 3 vehicles at high volume, it faces issues in terms of production cost and management resources and space
expansion in Gigafactory 1.

 Shortage of Batteries - In the annual shareholder meetings, CEO Elon Musk accepted that their production rate has
decreased due to the limited supply of batteries. The shortage directly affected the sales of electric vehicles and energy
storage systems.

 Elon Musk as Tesla’s Sole Representative - Tesla accepts that the company is a ‘one-man show.’ Sadly, that man,
Elon Musk has a lot on his shoulders to give his hundred percent to the company. Musk is also deeply involved in
other projects like space launch vehicles at Space Exploration Technologies Corporation and The Boring Company.
Tesla’s Opportunities
 Sales expansion in untapped Market - The most significant opportunity for the company
right now is the Asian market, which is still unsaturated in the field of automotive and
renewable energy markets. Especially in the situation where Tesla needs to expand its global
market to increase its financial stability and stronger market presences.

 Less Expensive Car - Tesla is expensive due to its unconventional reliance on innovation,
which requires maximum financial support to entertain new technology.

 Bringing battery production technology in-house - Tesla intends to make its own battery
cells. The move can be a big game-changer as it will help the company to increase its
manufacturing rate while reducing its production cost. Currently, Panasonic is their primary
supplier of battery.

 Introduction of pick up truck - According to National Automobile Dealer Association

market share data, Pick up truck accounts for 17.6 percent of the US automotive market,
which has huge opportunity of growth in Electric Vehicle.

 Market Confidence in Tesla - The stock market has shown confidence in Tesla after seeing
two consecutive profitable quarters. The price of Tesla stock has doubled since the start of
this year.
Tesla’s Threats
 Product Liability Claims - Tesla has launched many autopilot vehicles, and not all of them have been successful
in case of an accident. The company has faced lawsuits and claims related to the failure of technology in their
products. If these liability claims continued, then Tesla may be subjected to greater financial setbacks.

 Extensive Competition - Many brands are not only launching or planning to launch their environment-friendly/
self-driving technology but also, they are offering them at a comparably lower price. It is a definite threat for a
company like Tesla, which thrives on its unique value for innovative cars which are extremely expensive and
unaffordable for many.

 Product Defects - Due to highly complex engineering for innovative vehicles, Tesla’s cars and other energy
products have exhibited major flaws in many cases. The defected products often have weaknesses in design,
manufacturing, and other features which can harm the company’s image permanently.

 Long term confidence - For any company, the assurance of long term sustainability is essential to maintain the
public image and the company’s morale. Tesla, due to its unstable manufacturing conditions, suffers from disbelief
among the public about its long-term existence, which can result in a deficiency in further business development.

 Costumer Adaptation - Any business run along the lines of customer’s acceptance. If the public is ready to adapt
change, companies benefit from the innovative range of products. However, it can be a slow, unforgiving process,
producing new challenges for companies like Tesla. The organization highly depends upon customers willingness
to adopt electric vehicles.
Contd..

 Disruption of Supply Due to Shortage of Materials - Tesla can face major suspensions in the supply
of manufacturing materials due to the increased prices. The company uses aluminum, steel, lithium,
nickel, copper, and cobalt, as well as lithium-ion cells from suppliers. All these materials have volatile
prices, which can affect the company’s production line severely in the future.

 Self-Driving Cars Are Still a Concern for Pedestrians - In a survey from YouGov, US adults still feel
unsafe, to walk around self driving cars. Especially, people above the age of 55 are the most afraid to be
around self-driving vehicles.

 High-Risk Factor Due to Usage of Lithium-ion - Tesla uses lithium-ion cells in their battery packs.
Lithium is a highly reactive and explosive element, which increases the risk factor of our products.
Tesla has faced a few cases where their cars have caught fire and vented smoke, which has defamed the
company on a major level.

 Lack of Regulations for Self Driving - As there are no proper regulations for self-driving in many
countries, including the US, Tesla’s sale is effected by the self-driving restrictions in many areas. This
confusing situation of legal complexity increases uncertainty about Tesla’s self-driving project’s future.
BCG Matrix in the marketing strategy
of Tesla
 Model 3 is a combination of design, style, convenience, and moreover
safety. It has been priced as the least expensive model developed. The
official launch and delivery of the first 30 cars said to be on July 28, 2018.
So, the Model 3 belongs to the question mark category of the BCG matrix.
 Model S is a beautiful model which is packed with functionality,
convenience, and safety along with style and energy. It is said that it has
crushed a large luxury car competition in the USA. Out of 10 large luxury
car models, the Tesla Model S gobbled up a notable 34% of sales. Thus, it
belongs to the star category of the BCG Matrix.
 Model X is a long-range SUV. It has unique designs with falcon wings
that give the vehicle a unique and luxurious look and feel. Tesla is said to
be pushing back its production schedule for the Model 3. The sales for
Model X and Model S sales are soaring but Tesla is still struggling with
Model 3 production. This puts the Model 3 in the Dog category of the
BCG matrix.
 The ZEV credits or Zero Emission Vehicle credits can belong to the cash
cow for Tesla. It is required for automakers that a certain proportion of
vehicles sold emit no greenhouse. Tesla only makes vehicles that run on
battery and emit nothing, it usually has a surplus of sale. So, by selling
this, Tesla earned 100 million in revenue in 2017. The profit margin on
this is 95%. Thus, the ZEV credits are the cash cow.

 Here ends the BCG Matrix…