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Strategic Analysis of Tesla electric car

   

Added on  2021-02-20

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Strategic Management

Table of ContentsINTRODUCTION...........................................................................................................................3MAIN BODY...................................................................................................................................3External Analysis.........................................................................................................................3Internal Analysis..........................................................................................................................7CONCLUSION................................................................................................................................9REFERENCES..............................................................................................................................10

INTRODUCTIONStrategic management is useful in formulation and implementation of the organizationalgoals and objectives in a systematic and efficient manner. It helps organization in developinglong term goals by effectively allocating resources and identifying internal and externalenvironmental factors. Strategic management is very useful in strengthening the corecompetencies of business. This study will focus on critically examine the current strategicposition of the business by effectively evaluating the challenges and issues faced by theentrepreneurs, strategic managers and directors. This study highlights internal and externalstrategic analysis of the company.Tesla Electric car is an automotive energy storage company which was founded in theyear 2003 by Martin Eberhard, Marc Tarpenning, Elon Musk, J.B. Straubel and Ian Wright. Thiscompany mainly deals in Tesla Electric vehicles and Tesla energy. Automotive industry is one of the leading industry according to the current marketscenario. It is referred to be as one of the largest economic sector in term of revenue across theworld. It mainly deals in designing, development, manufacturing, production, merchandising andselling of motor vehicles. MAIN BODYStrategic management is one of the most effective tool which is useful in establishing thefuture goals and objectives for the business. Strategic management is very useful instrengthening the core competencies of business by critically examining the internal and externalstrategic analysis of the business. Strategic management consists of setting goals and objectives,effectively analysing, formulation of strategy, implementation of strategy and monitoring ofstrategy (Ansoff and et.al., 2018). It is also very useful in demonstrating the current challengesand issues of the entrepreneurs, managers and directors. This in turn helps in ling term growthand development of the Tesla Electric car company, UK. External AnalysisExternal analysis is a strategic tool which is useful in determining the factors which canaffect the operational efficiency of the business (Moutinho and Vargas-Sanchez, 2018). Externalanalysis can be done with the use of strategic tool such as PESTLE analysis and Porter's fiveforce model in order to critically evaluate the operational efficiency and performance of thecompany.

A. Trends and key driversPolitical factor: This is a strategic approach which can influence the functioning of thebusiness by developing strategic goals and objectives. There are various political factors whichcould affect the functioning of the business which mainly includes corruption, bureaucracy inthe local market, activities related with trade union, Tesla Inc. have a political stability which inturn is useful in qualifying for tax credit purchase of an electric car. Government has been takinginitiative to manufacture and sale electric vehicles (Hitt and Duane Ireland, 2017). Free tradeagreement among various international boundaries helps Tesla in reaching various largegeographical area and attain higher market share. Tesla electric car company will focus ontargeting markets which are politically stable in order to boost up the business. Economic factor: High economic growth of the country results in higher operationalproductivity sales and profitability for the Tesla electric cars company. There are variouseconomic factors such as interest rate, economic development, currency exchange rate,employment and unemployment rate, inflation rate, cost of labour, etc. in turn largely influencethe sustainable growth and development of the company. Sales of the electric car has been raisedby 3.5 percent which in turn has a positive impact on the sustainable growth of the business.Lower cost of material, decline in battery cost helps Tesla in producing affordable electricvehicles (Lasserre, 2017). Tesla is going to be affordable and accessible to the public which inturn increases the sales and profitability for Tesla. Zero emission vehicle also provides financialbenefit to the business. Social factor: Tesla electric car focuses on being environmentally sustainable byeffectively eliminating the use of fuel. There are various social factors such as career attitude,cultural barriers, safety emphasis, lifestyle attitude, age distribution, etc. influences thefunctioning of the business (PESTLE Analysis of Tesla Inc.: The growth of the eco-friendlyelectric car, 2018). This in turn has a positive impact on the society in order to eliminate carbonemission into the environment by effectively using renewable energy. Equal distribution ofwealth helps in improving the financial health of the business. Technological factor: Technology has been increasing at a faster pace which in turnresults in higher operational growth and efficiency. Tesla focuses on time to time innovationwith improved aerodynamics, battery, etc. helps in improved operational performance andproductivity for the Tesla Electric car. Tesla has an effective source for implementing

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