Strategy and Analysis of Tesla, Inc.

Running head: Mgmt 481
Mgmt 481

Mgmt 481
1
Contents
1. Strategy.................................................................................................................. 2
2. External Analysis......................................................................................................... 3
3. Internal Analysis.......................................................................................................... 6
4. Financials................................................................................................................... 8
5. Recommendations..................................................................................................... 9
Works Cited................................................................................................................. 12

Mgmt 481
2
Name: ____________________________
Date_:____________________________
1. Strategy
a. What is the name of the firm in the case and what strategy is it demonstrating?
The name of the firm is Tesla, Inc. Its CEO and co-founder Elon Musk demonstrated the
following strategies :
The company aimed to create solar roofs for its cars with cohesive battery storages.
It also aimed to expand the electric vehicle product lines for addressing all the major
segments (Jiao and Evans 250).
It had set the goals for developing cars with self-drive capabilities which are 10 times
more safe as compared to manual driving.
Furthermore, it aimed to make such cars so that the consumers can make money when
they are not using them (Grant 10).
In order to leverage its first strategy, it acquired Solar City in 2016.By doing so, it
integrated the generation of electricity with its storage along with providing zero-emission
vehicles. The second strategy aimed at expansion of its electric vehicles segment for
addressing all the divisions including trucks, heavy-duty semis and buses. The third
strategy aimed at developing self-driving abilities of the vehicles. Its goal was to make its
self-driving vehicles 10 times safer as compared to manual driving so that it is capable of
offering fully automated vehicles.
The fourth strategy of the company was to transform the vehicle into an asset which
generates the income for its owner in its spare time. The automatic driving car can be used

Mgmt 481
3
as a cab when its owner is not using it. It would decrease the ownership cost of the vehicle
(Teece, Peteraf and Leih 13).
b. What facts from the case support your choice of strategy for the firm?
The fact that the company did not invest in electric cars or in the luxury segment of
electric cars support my choice of strategy for the firm. It manufactured compelling
electric cars and introduced them into the market. It also built a network of charging
stations for resolving the problem of charging batteries on longer trips. So, its unique
business model managed to increase the sales of electric vehicles along with enhancing the
services. As a part of its business strategy, the mission of Tesla is “to increase the
production of cars with sustainable energy”( Fjeldstad and Snow 32).
So, it has collaborated with Panasonic, the world's largest electrical giant for
manufacturing batteries for its electric vehicles. Currently, it sells components and
powertrain systems to other manufacturers. It had also introduced its range of home
batteries known as Powerwall which can also serve as energy saving systems for
households or businesses. It also inserts Powerwall in its cars so that the solar energy can
be used by its consumers for their other usages apart from charging their cars. These
batteries are meant for connecting with solar energy and can be used as power backup
systems in case of interruption of power (Schaltegger, Lüdeke-Freund and Hansen 264).
Hence, Tesla is a perfect combination of innovation with sustainability as its co-founder
describes himself “as an engineer turned entrepreneur who manages and establishes