Business strategy on Tesla Assignment Sample
Added on 2021-02-20
13 Pages3998 Words26 Views
Business strategy
Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1PESTLE and SWOT analysis of the company............................................................................1Competitive environmental analysis of Tesla..............................................................................4TASK 2............................................................................................................................................6Evaluation of different types of strategic directions....................................................................6Recommendation.........................................................................................................................6Strategic management plan..........................................................................................................7CONCLUSION................................................................................................................................9REFERENCES..............................................................................................................................10
INTRODUCTIONBusiness strategy can be defined as a set of competitive actions & business model that isbeing used by companies in order to attract customers and compete successfully. This presentstudy is based on Tesla Motors that is an American automotive company whose headquarter is inPalo Alto, California, US. This company is specialize in electric car manufacturing. Thiscompany was founded by Martin Ebenhard, Marc Tarpenning, Elon Musk and J.B. Straube onJuly 1, 2003. It builds all electric and infinity scalable clean energy generation & storageproducts. This study is going to tell about external macro environmental factors like political,social, technological, economical that have impact on this automotive company to the greatextent (Wen, 2016). With the help of PESTLE analysis it makes itself able to analyse positiveand negative impacts of all external factors and then take corrective actions accordingly.Competition is also increasing rapidly and by using Porter's 5 forces model it analysescompetition factors and see its current position in the market. Strategic plan also plays animportant role as it helps this company to strengthen all those areas which required to beimproved for achieving its goals.TASK 1PESTLE and SWOT analysis of the companyPESTLE analysis: Tesla produces a variety of products and operates in differentcountries so it has to face various problems and there are various external factors that impacts onits performance and operations. It has been stated that this company is a reflective andappreciated because of its way of addressing and handling all external factors in the industryenvironment.Political: It is being stated that national and state government is encouraging thisindustry and for that it has taken initiative. This initiative which has been taken by thegovernment, Tesla company can take opportunity and have positive impacts on its performanceand can increase its sales of electric vehicle. There are political stability in various markets forthe auto mobile industry which is also beneficial for Tesla company as it makes environmentalsituations favourable (Gary and Heiko, 2015).Tesla organization have some opportunities frompolitical factors such as new global trade agreements and political stability in several developing1
countries where it operates. Political stability give opportunity to the company to the great extentas it helps them in market penetration and take competitive advantages.Economical: There are various economic factors in which some have positive impactsand other have negative impacts on its activities. Increment in the global economy has positiveimpact as it is rising the sales of electric vehicles. There is a dip in the prices of electric batteriesin order to make all electric vehicles affordable for people which can increase the profitability ofTesla company by achieving 30%v profit on its flagship Sedan models.Economic stability issuesare threat for the company. On the other hand renewable energy costs are decreasing which is anopportunity for the company because this company is more famous for its renewable energysolutions.Social: Tesla is famous for its electric cars, nowadays more people are becoming eco-friendly which is good for Tesla motor company. By producing more electric cars it can satisfysocial needs as well as environmental needs because it eliminates the use of fuel. Electric carsare affordable also as it does not require maintenance and running cost that makes this companymore sustainable.More customer are preferring to buy renewable energy that is an opportunityfor Tesla company. Increasing interest of people of different countries can increase their salesand profitability.Technological: Changes in the technology in this industry have positive and negativeimpacts as well. By investing in more in research & development and in advanced technology itcan make its products advanced and innovative. It can also make its strong position in themarket. On the other hand investment in technology can increase its overall cost which is notgood for the company (Phadermrod, Crowder and Wills, 2019). High rate of technologicalchange is an opportunity and threat somehow. If this company has strong financial stability thenthis factor can give them opportunity. On the other hand, instability of finance can increase theircost. Increasing automation in business is also opportunity for the company.Legal: There are various laws and regulations has been imposed by various governmentsthat are related to auto mobiles standards which put pressure on this company to follow allstandards with effectively. Sometimes it has negative impacts on its performance level. It hasbeen stated that due to some laws Tesla sales was temporarily blocked directly frommanufacturer to its consumers by many states. It is important for the company to comply with allregulations in order to run business activities smoothly.Dealership sales regulations in the US is2
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