Business Strategies for Tesla: PESTLE, SWOT, and Strategic Directions

Business strategies

INTRODUCTION
Business strategy is the decisions of company that aid the firm in accomplishing its goal
significantly(Galpin, 2019). Strategic planning is helpful in securing competitive position of the
firm.duration . Current assignment will be based on Tesla; it is the leading American firm that
offers electric cars to wide range of consumers across the world. In the year 2018, entity has
generated 21.46 Billion revenues. Current assignment will conduct environment analyses of
Tesla through Pestle, Swot analyses. It will apply porter’s five force model in order to analyses
competitive environment of Tesla. In addition, report will evaluate different strategic direction
available to organisation. Furthermore, it will produce plan that will include strategies, tactics of
organisation.
TASK 1
PESTLE, SWOT and organisational capabilities
Pestle analysis of tesla
Pestle analyses is the environmental analyses tool that helps in evaluating external
environment of business unit.
Political factors
There are so many political factors which are affecting the auto-mobile industrialist.
Specifically, it includes corruption and bureaucracy in market, freedom for press trade unions
activities(Hoelzlhammer, 2018). Trade policies of UK are free hence Tesla has opportunity to
enter into new market and expand its business across the world. Government of UK is supporting
Electric cars. This helps Tesla in running business successfully. Political instability creates
threats for business because changing government policies impacts negative on Tesla as it has to
make modifications in its practices and process as per the new regulations.
Economic factors
The economic factors can diversely affect the Tesla. Changes in economic policy of UK
directly affects the Tesla. When there are changes in foreign currency exchange rate then it can
affect the Tesla(Dixit, Clouse and Turken, 2019). Strategic Business Location Decisions:
Importance of Economic Factors and Place Image. Rutgers Business Review, 4(1).
. Due to the change in FER in the year 2017, $26.2 million was gained by the company in the
year 2016. The annual profits for both the year was $52.3 and $26.1 respectively. Volatile
exchange rates impact on the investment strategies of Tesla and long term performance of
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business get affected. In the condition of inflation Tesla face the issue because it affects
purchasing power of consumers. By this way firm fails to generate profit in the market(Tesla
motors, 2019).
Social factor
Changes in preferences of buyer’s impact on the demand of products of Tesla., as
nowadays people are demanding sporty cars and entity is offering them such kind of products. It
raises trust and loyalty of consumers and sales of business unit get increased significantly.
Electric car idea of Tesla is loved by people this has created positive brand image in the mind of
consumers(Peytcheva-Forsyth, Yovkova and Ladonlahti, 2017). This has affected production
strategy of business and has helped in increasing revenue of business unit. Preference of
renewable energy cars are increasing, this impacts positively on sales of business and help in
gaining competitive advantage to the organisation.
Technological factors
Technology is expanding and growing with the exponential rates. This is why Tesla
accept to upgrade its technology and adopt new changes which are required to sustain in market
and compete with competitors(Raje and eta.l., 2015). Tesla implements artificial intelligence
system and automotion techniques which make it unique from its competitors. This advancement
impacts positively on tesla and help in minimising wastage and manufacturing cost as well.
Legal factors
This factors include rule and regulation part which are governed by government. UK
government has made laws in favour of environment, these legal regulations impacts positive on
Tesla as by this way company can promote its Electric cars easily(Teece, 2018). Dealership sales
regulations restrict the firm hence it impacts on sales strategy of Tesla and impact on its
profitability as well
Environment factors
Tesla have to take care about the environment. They have to ensure that proper dispose of
waste generated by production. Nowadays everyone is going for low carbon and eco-friendly
environment. Dependence on old sources of energy is less because they are not renewable, so
uses of new sources of energy are in bulk and renewable. So, that the Tesla's idea of electric car
is loved by the peoples and because these cars are fuel efficient and maintenance is cheaper than
traditional vehicles(Yi and Bauer, 2015).
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