Resources and capabilities that big automotive firms have that Tesla may be lacking
In the recent past, Tesla has been noted as a great competitor in the automotive industry. This is attributed to its three huge competitive advantages. Generally, the advantage lies in its ability to bring about innovative disruption in the industry. This include; a strong battery supply chain that is sustainable in itself, a supercharger network celebrated by the customers and a software system several leagues ahead of its competitors (Zach, 2015).
However, despite Tesla’s internal competencies and a reputation of building exquisite products, it still encounters lack of major resources and capabilities that its competitors own. Building a car takes years or
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What does that tell us, Tesla may be having great challenges when it comes to resources and key capabilities? These include;
The focus of Tesla Company is on a niche in the automotive industry, which is building and selling electric cars. To a company like General Motors, the electric cars line of business is considered a side business, hence it only needs to study the patterns of Tesla’s cars then build on of its kind that will take Tesla out of business (Debord, 2015).
In addition, the economy is also working against Tesla as the gas and oil prices are dropping at a steady but positive way. This would render Tesla’s business unattractive, as people will be able to afford other types of cars other than the electric cars. Hence, the market economies may not be that favorable to Tesla as they are for other automotive sector market
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As the business, people put it, to maximize the wealth of shareholders (Peavler, 2016). This could be done by pursuing more of an immediate reason that will realize the shareholders wealth maximization goal. However, this main reason may fail to be realized as most mergers depict negative results.
In the Tesla- Solar City merger deal, the main reason for the merging is for both companies to enjoy a platform for new channels of distribution and product integrations that will enable both companies realize a greater good in the end (Lambert, 2016). For Tesla, its aim is to gain the infrastructure and hardware that solar city has for it to integrate solar installations into the its home battery pack solutions.
Consequently, this move will cut down the potential costs that the company would have to incur in order to do solar installations in its home battery pack solutions hence making it easier for it to implement its goals as now, only a solar installer partner will be needed to affect this move. On the other hand, solar city is at the verge of launching new solar panels that are focused on increasing the value of a house (Lambert, 2016). Wow! What a lofty
The contraposition for Tesla Motors is the rapid service received. Despite not having a traditional infrastructure, the company beats it opponents in its operational expeditiousness. The Palo Alto automaker’s response time for issues is often overnight, and always beyond convention. One customer with some play in his gears had his entire drivetrain replaced.
Tesla Motors Case Study Tesla Motors is a company that produces and sells automobiles. Tesla is not an old automobile company. Tesla specializes in all electric cars that run 100 percent on battery and focuses on the future. Tesla is looking into the future and realizes that fossil fuels will eventually run out. Tesla is moving toward a zero-emission future for the better.
Tesla stated the dependence from their suppliers as one of their main risk factors. We are dependent on our suppliers, the majority of which are single source suppliers, and the inability of these suppliers
Strengths Since first reporting profits in 2003, Tesla Motors has been climbing it’s way to brand awareness ( Hirsch, 2015). While the ever-growing and changing company has many accolades, there are three core strengths Tesla Motors has to offer. These core strengths include, competitive advantage, pricing, and supply chain management.
...Model S is one of the top safety picks. Tesla will be A great auto maker once they can sell their vehicles without being banned
One of the biggest strengths is obviously the company’s wide range of vehicles. Not only does it cover all segments including hatchback models and electric vehicles, but the company also has commercial vehicles such as buses and trucks (“Chevrolet SWOT, 2015). Another strength within the product mix is the almost infinite amount of technology that the company can provide with so many vehicle models. With creating hybrid and plugin version of vehicles like the Malibu and Tahoe, the company clearly as a great advantage over other automobile companies (“Chevrolet SWOT,
Tesla Motors initially gained widespread attention by manufacturing the Tesla Roadster, the primary totally electrical sports automobile. The company's second vehicle was the Model S, a completely electrical luxury sedan. Tesla additionally markets electrical powertrain elements, as well as lithium-ion battery packs, to automakers, as well as engineer and Toyota. Tesla's CEO, Elon Musk, has said he envisions Tesla as an independent maker, geared toward eventually providing electrical cars worth cheap to the typical client.
Tesla will help improve the environment by reducing air pollution and by reducing fossil fuel usage by using electricity instead of gasoline. This will make the world a safer and more efficient environment. This will further improve how our future
In fact the electric vehicle has been regarded as the best alternative to fuel cars in the future. Because the electric vehicle will not run by fuel which has been considered by many experts in many years later will be exhausted. As a result, world’s auto giants competitively invest heavily in electric vehicle research and development. For instance Tesla Motors which has been the pioneer of electric vehicles in the world is now gaining ever-increasing popularity globally. Tesla Motors change the global energy structure and provide a paradigm shift to the automobile industry. Other than that it contributes a lot to solving dependency of global transportation on oil which is one of the most important culprits for global climate change. However Tesla also suffers from some flaws that hinder the development of electric vehicles. For example the expensive production costs make the market price of the Tesla is difficult to achieve expected standard. Consequently the electric vehicle is difficult as popular as a normal car. In fact ordinary consumers will pay more attention to the economy of a vehicle but not whether it is environmental friendly. In addition the low battery life cannot meet the needs of people travelling long distances. Actually Tesla Models has promised that they would establish rapid charging stations network across the United States and all of Tesla 's electric car charging stations can be quickly filled with
He's skilled at partnering with other companies to develop new technology for them. These include Toyota and Daimier AG, which have also become investors in Tesla (Levi, 2013). Tesla is a small and focused company, nimble enough to respond quickly, and without the debt and pension burdens of the Big Three automakers (Levi, 2013). They were able to redesign the old Fremont NUMMI factory with state-of-the-art assembly lines. Customers look favorably on Tesla for design and innovation, and applaud its mission to reduce harm to the environment done by gasoline engines and emissions.
Perform analysis of the current Tesla market position. Determine strengths and weaknesses of its products.
The data that is advisable for me to develop my analysis I will use new coverage from all the major networks, the Tesla's website for their mission statement, future goals, and for future acquisitions, Kelly Blue Book for the value of cars as well as reviews, and Forbes. I develop and analysis of Tesla by preforming a SWOT Analysis, looking into the strategic management plans they have in place, and a look into their
This has resulted in exposing many automobile users to unpredictable prices of fuel. These issues were, however, the reason for the inception of Tesla Motors so as to bring into existence another set of automotive which serves the similar purpose but uses another form of energy that is electricity to drive them instead of the disadvantageous gasoline-powered engine. This invention was influenced by a number of factors in terms of its planning and performance (Hunger, 2010). Factors affecting Tesla’s planning and performance. The success of any organization, just like the Tesla Motor, largely depends on the planning of the activities by the management team in the company.
Here is the list of characteristics that allows Tesla to stand apart from its competitors:
The Capital investment, skilled and licensed labour force, technological advancements, working with good quality suppliers is considered big barriers of entry into this industry. The future requirement of electric cars and hybrid vehicles has opened this industry to some new entrants like Tesla.