Electric Vehicles: PESTLE Analysis, Porter's Five Forces, Organisational Changes

This report discusses the impact of PESTLE Analysis, Porter's Five Forces, and Organisational Changes on the electric vehicle industry. It focuses on the changes in Europe, the role of Tesla as a brand, and the opportunities for new business development. The report is divided into two parts, with the first part covering PESTLE Analysis, Porter's Five Forces, and various organisational changes, and the second part discussing Porter's Value Chain Analysis, new business opportunities, and the product life cycle of electric vehicles.

ELECTRIC
VECHICLES

Table of Contents
ELECTRIC VECHICLES....................................................................................................................1
PART 1..................................................................................................................................................2
INTRODUCTION................................................................................................................................2
A) PESTLE Analysis:......................................................................................................................2
B) Porters five forces:......................................................................................................................3
C) Organisational changes:..............................................................................................................4
D) Reason for various organisational changes.................................................................................5
CONCLUSION ...................................................................................................................................6
PART 2..................................................................................................................................................7
INTRODUCTION................................................................................................................................7
A) Porter Value Chain Analysis ......................................................................................................7
B) New business opportunities........................................................................................................9
C) Business to be discontinued........................................................................................................9
D) Product Life Cycle-..................................................................................................................10
Explain how green an Electric Vehicle is in current and future prospective.................................11
CONCLUSION..................................................................................................................................12
REFERENCES...................................................................................................................................13
Books &Journal:............................................................................................................................13

PART 1
INTRODUCTION
The electric vehicle industry is completely changing especially in Europe all the brands are
assuming lot of changes that are taking place in this industry. Europe has gone through lot of
changes in form of adoption of electric mobility to a “turbulent” period. It has been possible to
develop electric mobility so that drivers can move forward. There has been a complete
transformation that is taking please in this industry and is leading towards such changes. In the
present report there has been division in two parts. The report is based on TESLA that is a electric
vehicle brand having presence in UK. The first part is discussing about the PESTEL Aanalysis,
Porter’s five forces and various organisational changes that are taking place and reason for such
organisational changes. In the part two of the report there is discussion of porter’s value chain,
various business opportunities and how can further new opportunities be developed for a business
organisation. All such discussion will be helping in development of some strategies for successful
achievement of the overall laid down objectives.
A) PESTLE Analysis:
Pestel analysis is a tool that is increasingly used by various organisations for the purpose of
making a detailed analysis of the external environmental and various factors that are part of the
changing macro environment:
Political: It is a analysis that is used for purpose of understanding the factors that are
associated with the governmental regulations that are impacting a organisation (Ghez, 2019). In
concerns with Tesla there are targets set for the CO2 emission by vehicles. Further Government is
also willing to use some methods such as Tax credit and Tax concessions have to be provided to
organizations that are part of this industry.
Economic: It related to various economical changes that are taking place in the economy of a
country (Gafarov, 2019). Such as in present case of Tesla, there has been changes in the VAT
percents imposed on electric vehicles that have been cut down to some extent. Apart from this the
economic referendum of BREXIT referendum is also leading to many changes such as there as
there has been Britian leaving European Union and there are lot of changes because of this that are
impacting the overall economy of Europe. Such changes are leading to impact on Tesla as a electric
vehicle brand.
Social: It is related with the changes taking place in society (Nesti, 2018). Such as in Tesla,
there is a requirement to make more efforts towards sustainable development so that they can work

for the benefit of overall society and also for development of certain suitable environment friendly
measures in their future innovation in vehicles.
Technological: There must be use of better technology such as new technology has to be
brought by Tesla in their vehicles like use of artificial intelligence, carbon body of their vehicles,
further another major technological changes can be used that is lightweight body construction to
survive in this high competition scenario (Kiesha, 2018).
Environmental: It consists of the overall external environment that consists of protection of
external environment by use of certain eco friendly measures (Lugtu Jr, ., 2019). In Tesla there has
to be more attempts made by the organisation to develop their overall brand image in certain way
that there has to be more eco friendly measures that have to be developed in order to protect the
environment from such harmful emission caused by these vehicles.
Legal: It consists of various legal obligations that have been developed by legal authorities in
a country (Dudovskiy, 2018). Such as in Europe there has been more laws that have been made with
regards to protection of brand image by use of intellectual property rights such as PATENT that can
be used by Tesla so that their innovations cannot be copied or used by any other similar brand.
B) Porters five forces:
It is a technique that is used for the purpose of making a detailed evaluation of the major
five forces that are present in the external environment and are posing a impact on the functioning
and decision making process by such organisations. Present, there has been a discussion based on
Tesla:
Bargaining power of buyers: The overall power of buyers in the automotive industry is
very high as there are large number of manufacturers who are offering similar products. In case of
Tesla, the overall bargaining power of their customers is moderate as there are many hybrid and
electric vehicle alternatives that are being offered by other big competitors and this brand is not
negotiating their sale prices. So, it can be said that this is leading towards a scenario of low
bargaining power of buyers for Tesla as a electric vehicle brand of Europe.
Bargaining power of suppliers: The overall bargaining power of suppliers in case of Tesla
is moderate because the production of this Brand is limited as compared to other different brands of
this industry. Tesla is highly depended on their suppliers as they have to comeplet depended on their
suppliers such as Panasonic for their battery suppliers because of which such electric vehicles
cannot be operated. Tesla is leveraging their overall agreements with Panasonic so that they are able
to make use of log term association with such brands so that they can be benefitted from such long
term relationships (Dana, 2018).

Competitive rivalry: It related to the number of competitors that are present in the industry
and are impacting the way organisations are functioning (Hoelzlhammer, 2018). Such as in Tesla
there is very high competition. To deal with such high competition there is a requirement to increase
the continuous process of innovation such as from the case study it can be said that there has been
increase in the overall charging stations by in Europe by government initiatives which is leading to
increase in the sales of electric vehicles of Tesla as compared to other similar brands.
Threat of substitutes: it is related with the number of other brands who are available in the
market and present customers can substitute them who are the present user of Tesla products. The
customers can easily switch from products if they have lower switching cost and different
substitutes that are available in the European market (Gafarov, 2019).
Threat of New entry: there can be new entrants of some new entrants who can poses
overall impact on the industrial environment and is sued for determination of performance for
companies such as Tesla. This factor can be weakened if there is high cost of development of brand
by such new entrants or the cost of entering the electric vehicle market of Europe will be more
difficult. Apart from this to provide competition to already established brands such as Tesla there is
requirement to adopt economies of scale which is very difficult for any new brand that is willing to
provide threat to the success of TESLA.
C) Organisational changes:
There are certain organisational changes that are leading towards drive to electric vehicles
and that has been bought by Tesla such as:
Functional departments: There has been a complete change in the was structures have
been formed in organisation like there have been development of more functional departments and a
new department that is digital department is being added in which the employees who are part of
this department have to take care of the promotion op brad by use of digital media forces such as
social media platforms, content marketing etc.
 Supply volatility:With the growth in renewable energy sources there has been more
intermittency & volatility that has lead to more power supply. In case of Tesco there has been use of
more electrical sources energy as there can be dependency on wind or solar energy. It has lead to
more association with suppliers’ who will be providing them with electric vehicles.
Flattening structure: in case if Tesla, there has been a complete change in the
organisational structure such as the CEO Elon Musk is moving towards a flattening structure for the
purpose of improvement of communication and combination of various functions so that there can
be activities that can be trimmed that are vital for the success of organization.

D) Reason for various organisational changes
Organisational changes can occur at anytime and anywhere. There are various reasons for
organisation changes such as external and internal business environment, merger and acquisition,
governmental priorities, strategy and tactics, structural change etc. In relation with Tesla, enterprise
always introduces new products, technology, innovation etc. which leads to organisational change at
broader level. To deal with such changes HR manager of entity has to be adjustable and implement
effective policies as well as procedures so that management of firm do not get disrupted.
CONCLUSION
From the above made discussion it can be said that there has been a complete shift in the way
electrical industry is functioning ion Europe. There has been a major change that are taking place in
this industry and this is leading to more impact on the functioning of various electrical vehicle
brands like Tesla. There are more electrical charging stations that have been developed which is
leading towards more ease for customers to use such electrical vehicles for the purpose of their
fulfilment of travelling requirements and also make a contribution towards sustainable
development.

PART 2
INTRODUCTION
With changing world, demand and needs of people are also changing at rapid level. Electric
vehicles are introduced by many firm and Multinational Corporation with new ideas, thoughts and
technology. In relation with Tesla, which is automobile company headquartered in California. Firm
deals in energy storage, grid scale, solar panel, solar city etc. Elon Musk is the CEO of Tesla. This
section includes Porter Value Chain Analysis, product life cycle and brief about the electric
vehicles.
A) Porter Value Chain Analysis
This is tool or says framework used by firm which specifies all the activities related to
production and delivery of business. It is time consuming process and requires high level of
knowledge as well as expertise to understand the concept and draw the chain in proper manner. In
automobile industry, this is mostly used when decision is to be taken in the industry. It is
responsibility of the manager to understand all the functions as well as operation of this analysis so
that decision making related to this chain is done appropriate manner. In relation with Tesla, they
use this value chain analysis so that goals as well as objectives are achieved in proper manner. Also,
through this weak & strong spot of firm is analysed properly. This is also used as competitive
advantage by Tesla competes with rivals and competitors effectively. Thus, expertise needs to
present when this chain is prepared or implemented in organisation. There are many competitors of
Tesla such as BMW, Mercedes Benz, Toyota, Audi etc (Lugtu, 2019).
To overcome with competition and uncertain situations in market this value chain is used at
wider scale in business. Further, different types of industries used this framework according to their
management as well as structure & decisions are taken accordingly. In this manpower and resources
are used at larger scale so that it is understood by everyone in firm in easier manner. Once the
improvements areas are found in the section, efficiency of operation and business is increased in
better way. This results in higher productivity and more profitability. Automobile industry are
developing and using new technologies at broader as well as wider level. So, proper market
research is required to conduct all business activities and value chain. This chain includes primary
activities such as research and development, engineering, design & solution, marketing and sales
and services (Dudovskiy, 2018).These activities assist firm to deal with improvement areas in
proper manner. If these activities are not conducted in properly than chances conflicts as well as
errors might arise. So, to avoid issues & challenges it is necessary to be well aware about functions

and have knowledge about the same at depth.
This value chain analysis start from acquisition of raw materials and ends up with final
delivery of products, goods and services. Thus, manager needs to be updated about the problems
and issues occurring in parts of primary activities. In relevance with Tesla, all employees well
managed as well as skilled & handles all the problems or difficult situation in effective way. It is
systematic process which is to be adopted in proper manner.
Primary activities
Research and development- The first aspect of primary activity is R&D department of
firm. It is process of business in which new ideas, technology, are introduced within the firm. At
this stage, huge capital, manpower and resources are applied to get the result in effective manner. In
relation with Tesla, company is investing huge amount of capital in their R& D department for
growth and development of firm as well as business. Main objective of the department is to
introduce new or improvised technology into the market (Kiesha, 2018).
Engineering- Further comes the engineering aspects in which functional analysis,
evaluation, development phase and presentation phase in involved. This is the most crucial stage of
value chain analysis. Because in this evaluation and development of raw materials, products is
done. In context to Tesla, they use the engineering in such way that all functions & activities work
properly. It is essential so that errors do not arise in future and everything performs smoothly as
well as effectively.
Design and solution- Then arise the design and solution phase of primary activity in which
products, technology design and solution of problems related with those are determined and
evaluated. Tesla focuses on design and solution of their products & equipment’s so that customer
receives the total satisfaction at larger scale. To use this effectively Tesla use prototype and when
final decisions are made, then actual product is presented (Gafarov, 2019).
Marketing and sales- Each and every firm focuses on their marketing as well as sales
department to make product sale increased and to enhance the productivity level of business. In this,
delivery, transportation, product sold units etc. are included. It is important part of business because
without selling of product & marketing it to the people, it is difficult to increase the productivity of
firm. In relevance with Tesla, there way of doing marketing & sales is different from their rivals
because in 2008 Elon Musk created a commercial ad and launches their roadster car into space
which makes a history. Thus, though marketing and sales final delivered products are used and
consumed in appropriate manner.
Service- At last, it is crucial for business to give service or say after sales service in better

way to develop the relationship between customers and firm. Without a service it is not possible for
any organisation to interact with customers in consistently. In relevance with Tesla, they provide
good service to their customers which helps them in increasing goodwill of entity and management.
After a brief analysis of above matter it is stated that to run the business smoothly and
effectively Porter value chain analysis is necessary so that strategy and decisions are taken in
appropriate manner. This assists business in dealing with conflicts & problems and taking measures
accordingly.
B) New business opportunities
In business it is important to find and look for new opportunities so that new market share is
acquired by firm at larger level. It is duty of the manager to track as well as monitor such
opportunities which benefit the business and increases the productivity for longer period of time. To
do this, firm uses strategies and tactics like differentiation focus, cost focus etc. With
implementation of these strategies it becomes easy for firm to identify business opportunities and
adopt them in effective manner. Market is wider and becoming more advanced so enterprise need to
be more active towards emerging trends as well as changing demand of the people. In relevance
with Tesla, they do also have opportunities for their business such as they deliver less expensive
cars for example model S is affordable is used by many customers with good numbers. Thus, Tesla
has opportunity to expand their product line market so that they can target small and medium
market also. Moreover another opportunity for them is that they can introduce pickup trucks in U.S
market with high rise and demand. This is the reason why Tesla Cyber truck is mostly used by the
people. Also, to effectively use these opportunities entity has to be more advanced and ahead from
their rivals as well as competitors (Ghez, 2019).
C) Business to be discontinued
Not every business is able to run for longer period of time. Market is uncertain and is
unpredictable which means that problems and issues can arise at any time in future. So, for longer
sustain period of time Tesla need to discontinued the solar panel business because of its huge loss in
2019. Not all products of company are profitable and produce sales. Manager of the enterprise
should use effective measures so that non-profitable products come into existence and start
functioning in better way. Thus, cost and time is also saved when such business which are dimmed
into losses are removed or discontinued from the business. Hence, by discontinuing the solar panel
business Tesla may invest that amount in its other businesses (Nesti, 2018).

D) Product Life Cycle-
Product life cycle is systematic process of product and is used by organization with motive
of deciding when and how to take decision regarding the constructing or reconstructing of product.
It is basically scattered into four aspects which are introduction, growth, maturity and decline. All
these stages are part of PLC and assist enterprise to take effective decisions. In relation with Tesla,
it also uses PLC to look into the decision making process of product efficiently.
Introduction- It is the first aspects in which products are introduced into the market to
audience. In this, products are tested and marketing as well as sale of product is done at wider scale.
For example- in 2008 Tesla introduces and launches the first Tesla roadster. Main motive of firm in
introduction is to create awareness of product in the market. Another example Netflix earlier used to
sell DVD’s rental but with changing time it introduced the application (Dana, 2018).
The above picture shows the Tesla Product Life Cycle
Growth Stage- Further in the second aspect which is growth product which has been
introduced comes into market and wish to acquire larger market share and growth. This is done via
maintaining & managing the quality of product as well as providing with additional features to the
public/ audience. For example- Netflix when launched provides good subscription package and free
month subscription for first time user. This increases the number of users on steam and more offer
were introduced with changing time period (Hoelzlhammer, 2018).
Maturity stage- Then comes the maturity stage in which sales of products start decreases
mainly due to substitutes or high rise in competition. Every organisation passes through this and it
becomes difficult for them to survive in market. In context to Tesla, they are at growth stage
because of model S is raising in U.S which has increased the sale of product at rapid scale. If apply

to Netflix, they are at maturity stage because of availability of other online streaming applications
such as Amazon prime video, Voot, Hot star Disney plus etc.
Decline stage- Last aspect is decline stage in which business and products declines
gradually decreases in the market. At this, firm have following options which adopted such as
maintaining the low sale product, discontinue of the product etc. In relevance with Netflix it is in
the maturity place but last year in 2019 sale of steam was declining and this enforces Netflix to
change their subscription plans (Gafarov, 2019).
After a brief analysis of above matter it is stated that Product life cycle is essential and need
to be adopted by entities so that decisions regarding the product and business are taken effectively
and properly. Through this process, it becomes easy to determine and evaluate the performance as
well as progress level of enterprise. Thus, high level of expertise and skills are to be used before
going through PLC. Furthermore, it also means that firm is able to prevent itself from uncertain
situation of market and can use effective measures in appropriate manner.
Explain how green an Electric Vehicle is in current and future prospective
Time is changing at rapid degree and new technology is taking place in the market. In
today’s world, car has become necessity for the people. By considering the high rise in demand and
needs of people many automobile industries are introducing Electric Vehicles so that people need
not have to pay for the fuel and also to save the environment from being getting polluted. In relation
with Tesla, their roadster has enough lithium battery power to run across 244 miles on a single
charge. Lithium batteries are mostly used because of their high energy per unit mass. EV are green
because lithium batteries are used inside them and use of petrol or diesel is avoided which are
harmful for environment and are avoided by many people (Lincoln, 2018).
In future perspective, new batteries and portable products are to be introduced by entity so
that it becomes easy for people to charge their vehicles with limited time. For example- Kia e- Soul
is an affordable electric car but charging time of that car is too much. So, to counter the market and
customer need firm need to be more advanced as well as use innovative technology tools and ideas.
After a brief analysis of above matter it is stated that e vehicles are to be used in appropriate
manner so that customer do not get exhausted. With proper research and innovation it is possible to
produce more efficient electric cars with affordable process. Moreover, EV is green and protects the
environment from being getting polluted (Simatupang, 2017).

CONCLUSION
After a brief analysis of above report it is concluded that EV are beneficial for environment
as well as customers and are to be used proper way. With help of advanced technology, it is possible
to use tools and machines to produce more EV in the market at affordable prices. In this competitive
era, it is essential to be ahead from rivals & competitors by implementing strategies as well tactics
in business. Thus, new approaches are to be used by manager of firm so that entity survive in
market for longer period time.

REFERENCES
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vehicles in Germany.The International Journal of Life Cycle Assessment,24(12), pp.2220-
2237.
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Energy?.
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pestel-analysis-2/(2019-09-09).
Gafarov, 2019. Evaluation of the financial position and the performance of Tesla, Inc (Doctoral
dissertation, Masarykova univerzita, Ekonomicko-správ
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dissertation, Masarykova univerzita, Ekonomicko-správní fakulta).
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production,206, pp.238-250.
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Comparative Advantage Analysis of Amazon’s Trademarks and Intangibles.Com Through a
Value Chain and Comparative Advantage Analysis of Amazon’s Trademarks and Intangibles
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Nesti, M., 2018. Industria 4.0: il caso tesla ei processi di internazionalizzazione.
Sen, 2019. Material footprint of electric vehicles: A multiregional life cycle assessment.Journal of
cleaner production,209, pp.1033-1043.
Simatupang, 2017. The emergence of value chain thinking.International Journal of value chain
management,8(1), pp.40-57.
Valente, 2019. Using harmonised life-cycle indicators to explore the role of hydrogen in the
environmental performance of fuel cell electric vehicles.International Journal of Hydrogen
Energy.
Xiao, 2019, July. Environmental Impact Analysis of the Whole Life Cycle of Pure Electric Vehicles.
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