Detailed SWOT Analysis of Tesla Inc. - Open University B100 Report

This document presents a SWOT analysis of Tesla Motors Inc., examining its strengths, weaknesses, opportunities, and threats within the automotive industry. It identifies Tesla as a pioneer in electric vehicles and AI integration but highlights issues such as an inefficient supply chain, leading to deadline misses and underproduction. The analysis also points out unfavorable HR policies and a lack of effective marketing communication, impacting stakeholder trust. The report recommends leveraging sustainable initiatives to improve market visibility and strengthening relationships with the supply chain and stakeholders. Key issues discussed include supply chain inefficiencies, ineffective HR policies, and insufficient marketing efforts, with recommendations provided to address these challenges and capitalize on Tesla's strengths.

Running head: SWOT ANALYSIS OF TESLA
SWOT Analysis of Tesla
Name of the Student
Name of the University
Author Notes:

1SWOT ANALYSIS OF TESLA
Table of Contents
Introduction................................................................................................................................3
Background of the Case.............................................................................................................4
SWOT analysis...........................................................................................................................5
Definition...........................................................................................................................5
Purpose...............................................................................................................................7
Table: SWOT analysis (Source: As created by the author).....................................................15
Core Issues...............................................................................................................................15
Unfavourable HR policies................................................................................................16
Lack of marketing activities.............................................................................................17
Improper utilisation of the Supply chain..........................................................................18
Recommendation......................................................................................................................19
Conclusion................................................................................................................................20
REFERENCES.........................................................................................................................22

2SWOT ANALYSIS OF TESLA
Executive Summary
Tesla have been identified as a company who have acted as pioneers for innovation and
sustainability in the market. They have made considerable progress with the help of Artificial
Intelligence and electrically powered vehicles. The company have failed to utilise the full
efficacy of their supply chain. This has resulted in deadline misses and underproduction from
the part of the company. The HR policies and lack of marketing communication create a
negative impression of the company in the market and thus the company has not gained the
trust of its stakeholders. However the company can throw light on their sustainable initiatives
in order to gain visibility in the market and to develop better relationships with the supply
chain and the stakeholders as a whole.

3SWOT ANALYSIS OF TESLA
Introduction
SWOT analysis is a function that is used by various organizations all over the world
to assess the hindrances and catalysts of their business operations. A SWOT analysis puts
forward the internal and external factors that pose as strengths, weaknesses, opportunities and
threats for the effective performance and functioning of organizations1. It is a key factor
which determines the strategic operations that will be undertaken by a company2. The
strengths and opportunities determine the factors that might lead to be beneficial for the
operations of the company. On the other hand the weaknesses and threats are used to
determine the degree hindrances that the smooth functioning of a company can supposedly
experience while functioning in an industry that is considered to be dynamic. Tesla motors
Inc have been subject to mixed reviews in the past3. They have also been subject to mixed
reviews in the past and mostly have been due to the company’s inability to deliver. It has
been found the company have a faulty and inefficient supply chain and that has been
identified as the main reason behind their performance4. The company have been found to
rely on single suppliers for all the components that are required to manufacture tesla vehicles.
The issue has been significantly more visible with the Model 3 that was promised to be
supplied in a said amount by the company5. However the company where not able to do so.
This acts a handicap for the company and they are unable to capitalise of their idea of
supplying the market with electrically powered vehicles. The following paper will be used to
prepare a SWOT analysis for the company through which the important issues that hinder and
1 Bohari, Abdul Manaf, Cheng Wei Hin, and Nurwahida Fuad. "The competitiveness of halal food industry in
Malaysia: A SWOT-ICT analysis." Geografia-Malaysian Journal of Society and Space 9.1 (2017).
2 Yuan, Hongping. "A SWOT analysis of successful construction waste management." Journal of Cleaner
Production 39 (2013): 1-8.
3 Howe, Benjamin M., et al. "3 Tesla Zero TE Imaging of the Hip." (2016).
4 Hsu, Chin-Chun, Keah-Choon Tan, and Suhaiza Hanim Mohamad Zailani. "Strategic orientations, sustainable
supply chain initiatives, and reverse logistics: Empirical evidence from an emerging market." International
Journal of Operations & Production Management 36.1 (2016): 86-110.
5 Sung, Kyunghyun, Bruce L. Daniel, and Brian A. Hargreaves. "Transmit field inhomogeneity and T1
estimation errors in breast DCE‐MRI at 3 tesla." Journal of Magnetic Resonance Imaging 38.2 (2013): 454-459.

4SWOT ANALYSIS OF TESLA
bolster the performance of the company will be identified. Furthermore the paper will put
forward recommendations to the issues that have been caused by the negative factors and the
same will also be provided in accordance with how they can capitalise on the backgrounds
that they are good at.
Background of the Case
It is known that Tesla motors Inc. is the company who put forward the vision to
supply the consumers with electrical powered vehicles6. They have also played one the most
crucial roles in the automotive industry by presenting the industry with the idea of artificial
intelligence (AI) in vehicles7. Vehicles that have artificial intelligence are able to navigate
itself with little or negligible assistance from the user. Even though Tesla are the company
who have commercialised the above ideas, they have negligibly benefited from the same. The
ideas that was put forward by the company were capitalised on by other big and established
names within the industry. Tesla have been pioneers in providing the ideas, however, they
have not been able to successfully utilise on the same8. It can be said that the main reason
behind this performance and evident scenario is as a result of their faulty supply chain. The
supply chain has been identified as the Achilles’ heel of the company and the same has also
been identified as the reason behind the achieved performance of the company9. Furthermore
the supply chain of the company has been identified to be in-efficient10. The company is
comparatively new as compared to the established brands that exists within the industry. The
reason behind the success of other companies has been due to the fact that they have strong,
6 Kilsdonk, Iris D., et al. "Improved differentiation between MS and vascular brain lesions using FLAIR* at 7
Tesla." European radiology 24.4 (2014): 841-849.
7 Pinkse, Jonatan, René Bohnsack, and Ans Kolk. "The role of public and private protection in disruptive
innovation: The automotive industry and the emergence of low‐emission vehicles." Journal of Product
Innovation Management 31.1 (2014): 43-60.
8 Moritz, Manuel, et al. "Tesla Motors, Inc.: Pioneer towards a new strategic approach in the automobile
industry along the open source movement?." 2015 Portland International Conference On Management Of
Engineering And Technology (picmet). IEEE, 2015.
9 Karamitsios, Achilleas. "Open innovation in EVs: A case study of Tesla Motors." (2013).
10 Lebedeva, Natalia, Franco Di Persio, and Lois Boon-Brett. "Lithium ion battery value chain and related
opportunities for Europe." European Commission, Petten (2016).

5SWOT ANALYSIS OF TESLA
functioning and efficient supply chains11. It is said that establishment of clear and smooth
communication with the supply chain results in maximum efficiency derived from the latter12.
The inability to do the same has cost Tesla. It can be said that the supply chain of the
company is inefficient in delivering. This has been responsible for the deadline misses that
have been faced by the company along with the loss of goodwill and trust in the market. It
can be said that there is some fault or gap in communication that is taking place between the
company and its supply chain13. This keeps them from solving an issue that persists and
which is responsible for their ineffectiveness. It has also been identified that the company
have been relying on a sole supplier for all their vehicular components14. Depending on one
supplier is not a strategy that should be undertaken by any automotive company. The supply
chain in the automotive sectors is dynamic and thus is subject to various risk15. Thus
inefficiency from the part of the supply partner would imply that the same fate is faced by the
company. The company have been under delivering as compared to the rest and the supply
chains should be amended as soon as possible in order to avoid further loss of the interest of
the customers.
SWOT analysis
Definition
SWOT analysis is a strategic and systematic tool that is used by organizations all over
the world to locate, mitigate and cope with the difficulties faced by organisations and to
11 Matopoulos, Aristides, Ana Cristina Barros, and J. G. A. J. Van der Vorst. "Resource-efficient supply chains:
a research framework, literature review and research agenda." Supply Chain Management: An International
Journal 20.2 (2015): 218-236.
12 Czinkota, Michael, Hans Ruediger Kaufmann, and Gianpaolo Basile. "The relationship between legitimacy,
reputation, sustainability and branding for companies and their supply chains." Industrial Marketing
Management 43.1 (2014): 91-101.
13 Hu, Bin, Ming Hu, and Yi Yang. "Open or closed? Technology sharing, supplier investment, and
competition." Manufacturing & Service Operations Management 19.1 (2017): 132-149.
14 Liu, Yafeng Elsie, et al. "Tesla Motors Inc. Case Synopsis." Burnaby BC: Simon Fraser University.
Retrieved 10.18 (2014): 2014.
15 Matsuo, Hirofumi. "Implications of the Tohoku earthquake for Toyota׳ s coordination mechanism: Supply
chain disruption of automotive semiconductors." International Journal of Production Economics 161 (2015):
217-227.

6SWOT ANALYSIS OF TESLA
identify the factors that they can reap benefits of16. In simple words SWOT analysis is the
technique used by organization to identify their Strengths, Weaknesses, Opportunities and
Threats. It might not be feasible or possible for an organisation to directly locate or identify
the strengths, weaknesses, opportunities and threats. In certain instances organisations use the
SWOT analysis tool to identify the potential strengths, weaknesses, opportunities or threat
that are posed to and by the organisation. It can be opined that through an effective SWOT
analysis program companies or organisations can assume the aforementioned factors.
An effective SWOT analysis helps and organisation to analyse the market before
beginning to proceed with a certain operation17. Operation or activities such as starting a new
marketing campaign, launching a new product, shifting to a new geographical location,
adapting in accordance of newly formulated and many more activities require organisations
to conduct a SWOT analysis program. The efficacy or the SWOT analysis determines the
nature of the strategic operations that are undertaken by the organisation hence after. If a
SWOT analysis is conducted in an effective manner it can turn out to be productive for an
organisation. Through an effective SWOT analysis program a company can identify their
core strengths. It can also help determine the suitable opportunities that are presented before
the organisation. The opportunities that are presented to the organisation or the ones that are
identified by the organisation, along with the identified strengths can place the same
organisation in a position from where they can determine their advantage. The advantageous
position thus identified by the organisation can help them determine their Unique Selling
Proposition (USP). The USP of an organisation helps them position themselves indifferently
in the minds of the consumers18. Thus by conducting a SWOT analysis and by ensuring that
16 Milhem, Wajdi, Khalil Abushamsieh, and Maria Nieves Pérez Aróstegui. "Training Strategies,
Theories and Types." Journal of Accounting, Business & Management 21.1 (2014).
17 Brooks, Gail, Alan Heffner, and Dave Henderson. "A SWOT analysis of competitive knowledge from social
media for a small start-up business." The review of Business information systems (Online) 18.1 (2014): 23.
18 Niu, Yongge, and Cheng Lu Wang. "Revised Unique Selling Proposition: Scale Development, Validation, and
Application." Journal of Promotion Management 22.6 (2016): 874-896.

7SWOT ANALYSIS OF TESLA
the same has been carried out in an effective manner, organisations can locate the key point
through which the can gain competitive advantage against their competitors.
Just as an effective SWOT analysis helps determine the Strengths and opportunities
present before a said organisation, the same can be used to determine the weaknesses of the
organisation and the threats that are imposed on the smooth functioning and operating of the
organisation. The weaknesses of the organisation help them identify the areas in which they
need to improve. The organisation can screen their weaknesses by employing market research
activities. Furthermore companies can gain awareness about the loopholes in their functional
and operational framework. Threats posed to an organisation can be in the form of increased
competition, a very competitive environment, unfavourable industrial and government
policies. These factors can hamper the smooth functioning of an organisation and in certain
instances they are enough to halt the operational and functional activities within the
organisation. Companies can use the strengths and opportunities that they have located by
creating a scope to further improve on the same skills or attributes. The weaknesses and
threat that has been detected by the organisation can be used as constructive criticism and
after locating the same the company can choose to improve on the same and thus mitigate the
problems that were located by the SWOT analysis. Thus it can be said a SWOT analysis can
be used constructively and productively by any organisation and the same can help in setting
the organisation apart from its competition.
Purpose
A SWOT analysis is being carried out for the case of Tesla Motors Inc. Till is being
carried out in order to derive and locate the strengths, weaknesses, opportunities and threats
that are present for the organisation in the currents scenario. As discussed above it has been
seen that Tesla motors have been facing sever issue while carrying out their daily activities. I
has been found that the company are not being able to perform up to the desired levels of

8SWOT ANALYSIS OF TESLA
expectation of the managerial division of the company and are undercutting their deadlines19.
Moreover it was found that the company have not been able to deliver on their proposed
amount of production. It can be assumed that the reason behind this unfavourable and faulty
performance is as a result of the unfavourable climate of relationship that the company has
with its supply chain20. Furthermore it was also discovered from the case study that the
company a dependent on a single supplier for all the component and peripherals and are thus
not being able to derive maximum productivity from the supply chain. Being dependent on a
single supplier for all the component while operating in the automotive industry can be risky
and if a company aims to outperform their competitors they must be careful not be
completely dependent on any one particular member of the supply chain. The aim of the
paper is to identify the strengths, weaknesses, opportunities and threats that are prevalent
during the operations Tesla motors Inc. These bases or factors will be identified by
conducting a SWOT analysis of three functional division within the organisation. The
divisions that will be adjudged in the SWOT analysis are the Human Resources Department,
the finance and accounts department and the marketing department.
19 Song, Jian, Chun-wei Gu, and Xue-song Li. "Performance estimation of Tesla turbine applied in
small scale Organic Rankine Cycle (ORC) system." Applied Thermal Engineering110 (2017): 318-
326.
20 Morali, Oguz, and Cory Searcy. "A review of sustainable supply chain management practices in
Canada." Journal of business ethics 117.3 (2013): 635-658.

9SWOT ANALYSIS OF TESLA
Strengths (S) Weakness (W) Opportunities (O) Threats (T)
Human
Resource
Management
 Top down
approach: The
HR division
within the
company uses a
top down
approach of
leadership21.
The HR policies
within the
company
ensures that
there exists a
smooth flow of
communication.
 Even though
hierarchy exists
in the
organisation, it
is ensured that a
barrier free
communication
culture exists.
 The
organisation
encourages an
anonymous
feedback and
grievance
redressal
mechanism. The
employees of
the organisation
are allowed to
share their
opinions
regarding the
feelings and
 It has been
found that the
company have
not been able
to deliver on
the promises
that they have
made to its
stakeholders.
The company
has is
dependent on
sole supply
partners for
supplying
peripherals and
components of
their every
individual
vehicles. It can
be said that the
company has
not paid due
attention to the
needs of
creating
relations with
more members
in the supply
chain22. The
more the
merrier is a
statement that
is followed in
the automotive
industry and
thus the same
should be
 Companies
across the
world have
employed
various policies
to cater to the
need of the
employee in
order to
establish
engagement
with the
employee and
to ensure that
the employees
of the
organisation
are aligned to
the goals of the
organisation23.
Tesla have
been subject to
criticism
regarding their
HR policies in
the past and
thus they
should look at
the vast amount
of options that
are available
within the
industry.
 The company
can engage the
employees
through
employee
 Past activities
and practices
within the
company
have created a
negative
impression of
the company
in the
employment
sector of the
industry24.
The company
received
criticism for
the
terminating
employees
and for a
supposedly
unsafe and
unfit working
environment.
Thu it can be
said that the
company is
threatened by
the change of
image that the
company has
developed.
 The human
capital of a
company
form the base
of production
of every
company.
21 D'Elia, Gregory, et al. "Capstone Project-Tesla."
22 MacDuffie, John Paul. "The Policy Trajectories of Autonomous Vehicles." (2018).
23 Hulme, Oliver J., et al. "Sparse encoding of automatic visual association in hippocampal
networks." NeuroImage 102 (2014): 458-464.
24 Parrish, Michael H., et al. "Self-compassion and responses to negative social feedback: The role of fronto-
amygdala circuit connectivity." Self and Identity 17.6 (2018): 723-738.

10SWOT ANALYSIS OF TESLA
grievances
linked with the
company or
their Jobs. The
identities of the
employees are
not disclosed
and this ensures
that
communication
is clear from the
part of the
employees. This
along with a
smooth
communication
frameworks
ensures that the
employees
within the
organisation are
motivated and
the attrition
rates are low.
followed by
Tesla.
 The company
has been
subject to
various forms
of
discrimination
over the past
years. There
were several
instances when
the employees
reported
discrimination
in the
workplace.
Other than the
latter there has
also been
instances when
employees of
the company
reported unsafe
working
conditions and
harassment.
Thus the need
to formulate a
disciplinary
framework for
the company is
evident.
 The company
have been
accused for
mass
termination. In
a recent
performance
appraisal
program
conducted by
the HR
department of
the company,
four to seven
farewell
activities such
as rewards and
recognitions.
They can also
carry out
activities
through which
they can
engage the
employees. The
aim is to
develop and
atmosphere
which
encourages
employee
participation.
This will result
in motivated
employees.
Motivated and
engaged
employees
imply that the
attrition rates
within the
organisation
will be high.
 The
employees of
an
organisation
can be
considered as
the asset of
the
organisation
and it is based
on their
efforts that a
company
functions.
Thus it can be
said that there
is a threat that
is posed to the
proper
functioning of
the
organisation
if prospective
employee
choose not to
work with
company due
to the internal
affairs of the
company

11SWOT ANALYSIS OF TESLA
hundred
employees of
the company
were
terminated
form their
positions. Even
though the
company
reported that it
was a fair and
just appraisal,
one could
understand that
it was due to
the fact that
certain
divisions of the
company were
not being able
to perform
well. That
resulted in low
amount of
outputs
generated from
the same
division. Thus
this can be
identified as
the reason why
prospective
employee and
candidates
consider the
Tesla Motors
company as an
unsuitable
employer of
choice.
Finance and
Accounts
 The annual
revenue that was
generated by
Tesla during the
year 2017, 9.64
billion dollars25.
The sales
generated by the
 It has been
found that
Tesla have not
been able to
take advantage
of their supply
chain.
Furthermore it
 Tesla is a
company that is
considerably
smaller than
companies
such Toyota
and general
motors.
 According to
the
information
sourced from
the case
study, it has
been found
that the
25 Chen, Yurong, and Yannick Perez. "Business model design: lessons learned from Tesla Motors." Towards a
Sustainable Economy. Springer, Cham, 2018. 53-69.

12SWOT ANALYSIS OF TESLA
company
amounted to 8.5
billion dollars
that was derived
from sales and
the remainder
was generated
from leases. The
latter amounted
to 1.1 billion
dollars.
 While the
expenses
amounted to
2.476 billion
dollars the total
revenue that was
generated by the
company
resulted in the
formation of
total revenue
that amounted to
2.220 billion
dollars26.
 Thus it can be
said from the
amount of sales
generated by the
company along
with the huge
profit generated,
the financial
strength of the
company forms
the base of the
company’s
repertoire.
can be said that
the company
are way too
much
dependent on a
single supplier
for all their
peripherals.
This was seen
in the case of
the model 3
vehicles that
the company
proposed to
launch. It was
seen that the
company were
only utilizing
about 20% of
the supply
chain that
cannot be
considered
much when
being
compared to
big players in
the market
such as Toyota.
The financial
resources of
the company
were also not
directed well.
This finally led
to resource
shortage as the
company was
not able to pay
the suppliers in
advance. It has
been found that
most of the
suppliers
depend on
advance
payment after
which they
cater to the
However the
company still
has market
presence in
various
countries
across the
world. There
have been
mixed reviews
about the
performance of
the company in
the financial
department.
There have
been ups and
downs.
However the
company must
increase their
performance in
the capital
markets. It can
be said that if
the company
collaborate the
efforts of all
the existing
functional
differences
within the
company to
formulate a
strategic
alliance, they
can gain
considerable
amount of
revenue.
 Tesla have
been company
who have been
mostly focused
on the western
part of the
world. Tesla
can look at
huge
company has
been subject
of
undershooting
on their
production.
They have not
been able to
fully utilise
the efficacy of
their supply
chain and this
has resulted in
failure to
meet the
production
targets. An
indirect
financial
threat is posed
to the
existence of
the company.
The company
is threatened
by a risk of
loss of
potential
customers.
The company
could have
made
additional
amounts of
revenue and if
they had
delivered
according to
their proposed
figures.
26 Van Den Steen, Eric. "Tesla Motors." Harvard Business School Case, 9-714 413 (2014).

13SWOT ANALYSIS OF TESLA
demand of the
company. This
can be
identified as
the reason
behind the
under
performance of
the company.
Thus it can be
concluded by
stating the fact
that funding is
an issue within
the
organisation.
 It has also been
identified that
the company
has high debt
load. As of the
end of the
financial year
ending of 2016,
the company
has long-term
debt that
amounted to
approximately
2.5 billion
dollars. Debt
was also
realised in
forms of leases
and the sum
total of the two
amounted to
more than
seventy percent
of the total
capital that was
invested in the
business. This
impairment in
performance
resulted in a
low
formulation of
capital and the
degree of
automotive
market that
exists in the
eastern part of
the world.
They can
capitalise on
the population
that exist in
such markets.

14SWOT ANALYSIS OF TESLA
opportunity
loss. Cash in
hand was
found to be on
a low of 1.4
billion dollars.
Marketing  Position in the
market: The
Company has a
unique position
in the market.
At Tesla,
marketing is
beyond the idea
of just
developing and
selling cars. The
company
believes in
innovation and
they have been
acting as
pioneers in
providing
innovation in
the market. It is
a known fact
that Tesla have
popularised the
idea of electric
powered
vehicles. They
are also the
company who
have been one
of the first to
introduce and
carry out
production of
vehicles that
boasts Artificial
Intelligence (AI)
in their vehicles.
Furthermore
they are the
company who
popularised the
use of the same
in the market.
 Leaders in
 Tesla were the
company who
popularised the
concept of
electronic
vehicles. The
company also
introduced and
commercialise
d the use of
Artificial
Intelligence
and fully
automated
vehicles. They
revolutionised
the market
although they
were not the
ones to reap
benefits from
that.
Companies
such as Ford,
Fiat, General
motors and
Chrysler have
capitalised on
the same and
have had
favourable
market
performance.
The main
reason behind
the same is the
lack of
marketing
activities that
has been
carried out by
the company.
 The company
have been
 Opportunities
are presented to
the company in
the form of
various types
of marketing
opportunities
that are present
for the
companies. The
company have
already
employed the
extensive use
of social media
in their
activities such
as their
dedicated
applications for
software
updates of their
vehicles. It is a
known fact that
advertisement
and
commercial
help the
company to
gain visibility.
The company
should employ
advertising in
three forms of
media. They
should produce
commercials
for sports
events, use and
employ print
media ads in
the form of
billboards.
They should
 The company
have not
employed a
marketing
tactic that
helps them in
differentiating
them form the
rest of the
competition,
However is
has been seen
that the rest of
the
competition
have devised
their market
strategies in
such a way
that the
companies are
able to
establish
themselves
individually
in the market
and
differentiate
them form the
others while
doing so.
Tesla Motors
Inc. is
threatened by
the fact that
they can get
overshadowed
by the
intensive
marketing and
differentiating
strategies that
are employed
by its

15SWOT ANALYSIS OF TESLA
their segment:
Tesla motors
Inc. are not the
sole company
that have
innovated and
introduced AI
and powered
their systems
with electricity.
Other players in
the automotive
industry such as
BYD and
Toyota had also
launched
electricity
powered
vehicles. Even
on the existence
of so many
companies,
Tesla were the
market leaders
in selling
maximum
number of
Electricity
powered vehicle
in the market.
carrying out
marketing.
However, it
can be
understood that
all the
functioning
department are
not
communicating
properly. The
latter is
responsible for
the lack of
success of the
company.
also include
sales
promotional
activities to
attract that
customers with
elusive offers.
 The company
should engage
themselves in
Sustainable
development.
Companies
across various
industries have
been successful
in employing
sustainable
development in
their activities
and have
received
success form
the same. The
company have
engineered and
commercialised
the use of
electric
vehicles. Thus
it can be
opined that the
company
should market
and spread
awareness for
such activities.
competitors.
Table: SWOT analysis (Source: As created by the author)
Core Issues
The point of strengths, weaknesses, opportunities and threats have been adjudged and
enumerated in the above section. It is clear that Tesla is has been recognised as the company
who have acted as pioneers for innovation in the automotive industry. The company has been

16SWOT ANALYSIS OF TESLA
recognised as the first company to introduce the use of Electricity powered vehicles27. They
are the first company to popularise the use of Artificial Intelligence in vehicles. However the
company have not been able to capitalise on the innovations that were presented to them by
the market. It has been other big names who have capitalised on the innovative ideas that
were introduced by Tesla Motors Inc. The company have been also subject to criticism for
the unfavourable HR policies within the organisation and thus have resulted in attrition28.
Furthermore the company have not been able to deliver on the production targets and thus
have been found to miss their production deadlines on several occasions. The latter and
former have been responsible for the negative goodwill that have been earned by the
company. The core concepts have been enumerated in detail in the following section.
Unfavourable HR policies
The HR policies of Tesla Motors Inc. cannot be considered uniform. A portion of
their policy should be appreciated on the grounds of encouraging employee participation.
Employee of the company are able to address their grievance without having to ponder about
the implications. There also exists a smooth communication framework through which there
is unfiltered communication within the. This can be considered to be a good sign. Companies
should encourage smooth communication frameworks the same is responsible for ensuring
smooth operations within the organisation. There should also an effective grievance redressal
system as it helps organisations to keep their employees motivated and satisfied. On a
contradictory note, the supposed reports of unfavourable working conditions along with the
incidence of harassment and discrimination within the organisation can undermine the
benefits that are provided by the company’s HR policies. Furthermore, there have been
instances under which between four hundred to five hundred employees were employees
27 Fleming, Bill. "Electric vehicle collaboration-toyota motor corporation and tesla motors [automotive
electronics]." IEEE Vehicular Technology Magazine 8.1 (2013): 4-9.
28 Kim, J. H., et al. "Contrast echocardiography to assess left ventricular volume and function in Beagle dogs:
comparison with 3-Tesla dual source parallel cardiac magnetic resonance imaging." The Veterinary
Journal 198.2 (2013): 450-456.

17SWOT ANALYSIS OF TESLA
were terminated from their jobs without any formal notice. The negative climate within the
organisation thus poses a threat to the HR department and the company as a whole.
Negativity within the organisation quickly resonates outside. This might ultimately result in
personnel shortage within the organisation as a result of the negative attitude of the
employees already engaged within the organisation along with the prospective candidates.
Lack of marketing activities
Tesla have been recognised as one of the first companies to provide the idea of
vehicles that can be powered by electricity. The company had reasonable amount of success
in the field of electric vehicles. The company have recently popularised the use of artificial
intelligence (AI) in their vehicles. The use of AI sets the company apart from its
competitors29. The company have been boasting a unique place in the market. The company
act as pioneers for sustainable development through their initiatives of introducing electricity
powered vehicles. The amount of negative effects that emission from petrol and diesel
powered vehicles cause to the environment is huge30. The emissions from vehicles using the
aforementioned sources of fuel have been responsible for the impairment of the atmosphere.
The company have innovated for a cause that can be considered noble. However they have
failed to utilise on the opportunity that they created. Tesla is a company that can be
considered considerably new than the existing and established player within the automotive
industry. The established companies used their experienced and effective marketing tactics
and promotional activities to capitalise on the initiatives that have been framed in accordance
with the sustainable development initiatives. The Tesla Motors Inc. company have failed to
utilise the marketing division of the company. Even though the company have promoted their
29 Lin, Patrick, Keith Abney, and Ryan Jenkins, eds. Robot Ethics 2.0: From Autonomous Cars to Artificial
Intelligence. Oxford University Press, 2017.
30 Negoiţescu, Arina, and Adriana Tokar. "Investigations on car emissions under the urban traffic conditions
with the influence on Timişoara air quality." Transport 28.1 (2013): 38-45.

18SWOT ANALYSIS OF TESLA
products that is their cars, they have failed to recognise the importance of promoting and
marketing their sustainability development efforts. It can be said that a company can
differentiate themselves from others through their sustainability development initiatives. Thus
companies who have the favourable strategic functions aligned with the sustainable issues
can turn out to be productive in the long run. Tesla have not employee their sustainable
activities. If they had conducted marketing and promotional activities for the same, they
would not be facing the same fate as they are subject to now. Furthermore the company are
faced with the issue of underproduction. This has resulted from the absence of a smooth
communication frameworks. Additionally it can be said that the company initiative of the
company were not favourably communicated to the members of the supply chain. The
members of the supply chain that is the only supplier for the case of Tesla, where supposedly
influenced by the negative information that existed about the company. Thus it can be opined
that the company should invest in marketing and promotional activities in order to highlight
the efforts that the company have commended over from the years of initiation of the
company.
Improper utilisation of the Supply chain
It is a well-known fact that companies in the automotive industry do not source their
product materials from a single supplier. It is generally seen that companies in the industry
create a chain of suppliers who are responsible for supplying one or more components that
are needed for assembling the final product. Furthermore, in certain instances, companies
form partnerships with two or more suppliers who are responsible for supplying the same
components. Even though this practice is common in the industry, Telsa Motors Inc. have
failed to utilise the effectiveness of the supply chain. The company have been accused of
under delivering. The company could not meet their deadlines regarding the proposed
number of units the proposed to produce. Tesla manufactures their own engines and thus are

19SWOT ANALYSIS OF TESLA
considered as an OEM31. OEM is the short form of Original Equipment Manufacture and it
has been found that OEMs can only utilise about one fifth of the total supply chain. Since the
company was investing time in producing their own engines they had to kip important phases
such as the prototype phase in a certain instance. This was the case that transpired when the
company where off from the actual mark of production and this was the case when the
company were launching the Tesla Model 3. The company had to skip the prototype phase
and were in a position when they had to produce five thousand vehicles within a week. Tesla
have acted as an example for the industry regarding what happens when a company with lack
of capital, adequate flow of cash and a highly unstable supply chain aim to produce vehicles
at large scale.
Recommendation
From the issues detected in the above section, it is evident that the company is faced
by quite a few issues that are hindering their performance and which is stopping the company
from achieving their full potential. Lack of marketing communication or activities can be
deemed to be one of the most significant issues that the company could be good at. However
the company are clearly lacking in this.
As stated several times above, the company are one of the first company’s in the
industry if not the very first, to develop vehicles that can be powered by electricity. The
company has also kept on researching about innovation. This resulted in the implementation
of Artificial Intelligence in vehicles. This revolutionised the industry soon after which
various automobile companies started to implement the same in their technology. The issues
that have been identified by the company can set them apart from the competition and also
31 Cheong, Taesu, Sang Hwa Song, and Chao Hu. "Strategic alliance with competitors in the electric vehicle
market: tesla motor’s case." Mathematical Problems in Engineering 2016 (2016).

20SWOT ANALYSIS OF TESLA
can help to motivate the employee along with the supply chain. Thus it is recommended that
the company should improve their marketing communications frameworks;
 The company should carry out intensive marketing. Activities such as sales promotion
and advertising can help the company gain visibility in the market.
 The marketing activities would imply that the amount of investment directed towards
such activities should be multiplied. Increased investment in marketing would imply
that the expenses accrued would become higher. However with increased exposure to
the consumers, it is assumed that the expected conversion rate of potential customers
to actual ones would increase, thus resulting in higher turnover. Thus would result in
healthy stakeholder relationships.
 On gaining increased visibility on the market, the company can afford to highlight
their sustainable development activities such as concern for the environment and
continuous innovation which would possibly result in development of better
relationship with the supply chain and the stakeholders as a whole.
Conclusion
It has been highlighted by now that Tesla have introduced innovation and
sustainability in their activities in the form of AI and EVs. The company have been accused
of missing their deadlines and proposed production on several occasions. Furthermore it can
be said the reason for the unfavourable performance of the company is mainly due to lack of
coordination with the supply chain. Along with that, the unfavourable HR practices have
damaged their reputation in the industry and employment market. The company lacked
funding, however they have been successful in generating a reasonable amount of profit in
the market with constant innovations. On a concluding note, it can be said that the company

21SWOT ANALYSIS OF TESLA
lacks marketing communications and have also failed to utilise their supply chain. Improving
on the same would result in improved relationship with the supply chain members and
stakeholders as a whole.

22SWOT ANALYSIS OF TESLA
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