SWOT Analysis of Tesla Motors Company

This article provides a detailed SWOT analysis of Tesla Motors Company, including its strengths, weaknesses, business opportunities, and threats. It also discusses the manufacturing facility and its disruptive technology, HRM and workplace ethics and standards.

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Table of Contents
Introduction......................................................................................................................................3
SWOT analysis of Tesla Motors Company.....................................................................................3
Strength........................................................................................................................................3
Weaknesses..................................................................................................................................4
Business opportunities for Tesla Motors.....................................................................................5
Threats in the business of Tesla Motors.......................................................................................6
The manufacturing facility and its disruptive Technology..............................................................7
HRM and workplace ethics and Standards......................................................................................7
Conclusion.......................................................................................................................................8
Reference List..................................................................................................................................9

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Introduction
Tesla Motors Company was established in 2003. The Organisation was founded by a
group of Engineers with an intention of breaking conventional mind-sets regarding electric cars.
There are also a number of first and innovations against the name of the company and that has
also forced several competitors to innovate new designs in the domain of alternative energy
vehicles. Tesla Motors is an organisation that has vehicles from almost all the categories
including sedans convertibles hatchbacks and another sector of cars where all the above
mentioned categories are available and are driven by alternative energy (Stringham, Miller and
Clark, 2015).
The vehicles company has its headquarters in Fremont California and one of the essential
business goals is to ensure the development of an absolutely sustainable energy based ecosystem.
As per Tansel (2015), there are variety of other products of the company that enables the
customers to manufacture as well as store forms of alternative sustainable options of energy.
Being owned by Ellen musk Tesla, the company has been able to successfully make an annual
turnover of US dollars 29 billion and are currently operating with about 38, 000 successful and
promising employees.
SWOT analysis of Tesla Motors Company
Strength
The most essential strains of the company are the technology related aspects. The
company has been able to innovate cutting edge Technologies like no other organisation and in
fact many companies are purchasing the copyrighted machineries from Tesla which is the big

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source of income for the company also (Chen and Perez 2018). Amazon example of such a
company is Daimler which purchases battery packs of Tesla and so as is
Mercedes-Benz that makes use of the power trains of Tesla. Other major components that
gives strength to the company are the ample amount of support that the gift from the local
government. The national power saving scheme has awarded Tesla with US dollars 465 billion
for their successful Energy Management and for the purpose of indulging into Energy
Management projects that have been patronized by the u. S. Department of energy. As
highlighted by Hettich and Müller-Stewens (2017), they are major drivers of the clean-tech
initiatives of the United States and as such they have gained lots of advantages from the
American government with the life that include tax evasion and reduction of Corporate tax rate
along with some anonymous market entry facilities.
Among the major strength factors, the Monopoly that Tesla enjoys can also be included.
In the initial days the company used to target a quite niche market segment that was in favour of
purchasing electric as well as alternative energy cars. However, the company's strategy was to
penetrate into an existing segment and as such they have developed a market segment of their
own that encompasses a large demography and geography. On top of that, Hess and Andiola
(2017), states that the major aspect is that Tesla Motors have the absolute monopoly over that
target segment and farmers people in their growth merging compared to their counterparts in the
market.
Weaknesses

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Among the important factors that might be counted as weaknesses for the company the
first factor that deserves mention is their poor liquidity. Compared to their competitors like food
that has an accumulated market value of about US dollars 20 billion, General Motors having
about US dollars 25 billion or Fiat having US dollar 40 billion value, Tesla has been having a
market value of only US dollar 3 billion. As stated by researchers like Motors (2015), such
market strength is not sufficient for a company in the automobile sector to survive the immense
market competition and very soon Tesla might have to adopt cost cutting strategies like
termination of employee segment or other similar strategies
Then again, Tesla Motors have been facing capacity issues also. Namely, one major issue
is that the company has been conducting their manufacturing operations in a single plant only
situated in Fremont of California. the plant is having a capacitance of developing 500000
vehicles only and this is the maximum production capacity for the company and as such will
make it difficult for Tesla Motors to achieve larger target markets or if they are to raise the
volume of their production (Voigt, Buliga and Michl 2017).
The last factor that can be counted as a weakness for the company is the poor awareness
level of their customers. The products that the company manufacture are essential for sustenance
of the environment since the future sustainability is always preferred objective for the
organisation. How is work, as several researchers like Kwan (2015), have derived, the products
that are manufactured by Tesla Motors are absolutely futuristic and maximum number of
customers are confused whether they should invest in purchasing the products of Tesla or not in
the current market. Although, several organisations that are developing industries and investing
into futuristic Technologies, or pertaining to the Technologies developed by Tesla get more

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expensive technological disruptions developed by the organisation have not seen the face of
profit so far.
Business opportunities for Tesla Motors
The First Avenue for futuristic opportunities that can come in the way of the companies
is their preference towards new technologies. Vehicle technology is taking and absolutely
innovative turn and there are a cluster of new technologies like green cars, battery cars, hybrid
vehicles, electric cars as well as self driven autonomous vehicles also. Tesla, through their
disruptive research and development, have been able to launch many of the products that are
being driven by this future reach Technology. About 55% of the vehicles manufactured by Tesla
green cars and among them about 9% are hybrid vehicles. There are 15 US patent for self driven
autonomous cars of Tesla that are still in the stage of conception and is expected to hit the road
by the end of 2035. Another important area of opportunity for the company is that the
governments of the developing countries also adapting and inviting the organisations that Foster
disruptive Eco sustainable Technology and related products (Krebs 2016). Hence, there is a
chance of future expansion of the company in new markets and as such the company will enjoy a
better number of profit making channels by means of which they can invest in production and for
the technological developments.
Threats in the business of Tesla Motors
Business traits can be classified as factors in external as well as internal business
environment which might suggest to be detrimental for the growth of the company. Some of the
similar threats that the company face are competition, alternative technological impacts, lack of
acceptance and other similar factors. Of these, the most essential factor is competition from

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existing market players. a lot of competition is shown towards Tesla Motors from organisations
like food, that holds about 31% of the entire automobile market of the USA, followed by Fiat as
well as General Motors who hold in Unison about 23% of the market and the rest is occupied by
other bearing companies that are also top notch automobile manufacturing companies in the
country. In fact it is true that the company is being patronized by various Agencies as well as
government forums for their technological disruption that drives sustainable development for the
ecosystem, there is sales parity are falling in the last five financial year and current trends show
that the awareness level of the general public has not reached such a level that they might
consider buying Eco-friendly products as far as high budget purchases are concerned (Rogerson
2017). In fact technology companies like Google I also making carbon output that is higher than
that of Tesla Motors and hence it is suggestible that probably the market for the company has not
yet been set up by means of which they can drive Technology into sales and profit.
The manufacturing facility and its disruptive Technology
The Fremont facility of Tesla Motors have been pioneering Lee integrating
manufacturing that is self contained with each division supporting a different supply chain for a
different production units and in the end the products are combined for satisfying a common
need. This is one benefit of disruptive technological innovation of Tesla that is enabling the
appointment of people from various sectors and does creating employment opportunities also
(Chen and Perez 2018). To talk about the manufacturing facility of Tesla, the SMG hydraulic
press in the Fremont facility that is of 7stories tall. By means of this facility the company can
finish 6 million dollar worth production in 23 model vehicles at a time and Tesla has been
planning to install 35 such process into the domain of auto manufacturing all over the world. As

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an impact of this, it can be projected that in the future the carbon output, waste generation as well
as human labour will be reduced to a great extent so far as industrial production is concerned.
HRM and workplace ethics and Standards
The total recordable incident rate in the company’s production units has dropped by
about 25% in the year 2018 compared to as it was in the year 2016. This shows that in spite of
driving in experimental as well as technological disruptive productions, the production line of
Tesla is very safe. Although, the condition of the production unit was not the same always
(Hettich and Müller-Stewens 2017). Through the year 2017 the factory workers had waste in
thorough inspections of the manufacturing units and the employee Union paint larger part of the
Year throwing partitions for better safety standards in the workplace. In terms of reducing
employee’s risks also, the company drove technological disruption. They have developed a semi
automated manufacturing line so that exercise as well as mandatory overtime that was
complementary for the employees of Tesla at a time can be overthrown and as a direct impact of
that the rate of accidents in the company has reduced (Kwan 2015). The company also developed
an ergonomics team for ensuring that none of the workers where experiencing unnecessary strain
at the time of production as well as also in the Assembly line of their approaching orders.
Conclusion
In conclusion it can be stated that Tesla has been the major driver behind disruptive
technology and they have used it for not only product innovation but for also driving invention in
manufacturing as well as sales. By means of these the company has been an iconic leader in the
market of alternative cars. It is a fact that the sales parity of the company has not increased,
however major signals from the governments as well as the foreign markets shows that the

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market proximity as well as opportunity for alternative fuel or alternative energy given cars
manufactured by Tesla is very high in the future.

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Reference List
Chen, Y. and Perez, Y., 2018. Business model design: lessons learned from Tesla Motors. In
Towards a Sustainable Economy (pp. 53-69). Springer, Cham.
Hess, M.F. and Andiola, L.M., 2017. Fraud Risk Brainstorming at Tesla Motors. Issues in
Accounting Education, 33(2), pp.19-34.
Hettich, E. and Müller-Stewens, G., 2017. Tesla Motors. Business Model Configuration.
Krebs, S., 2016. Silent by design? Tesla's Model S and the discourse on electric vehicle sound:
Tesla Motors Germany, Model S 85D (2015). Sound Studies, 2(1), pp.93-95.
Kwan, N., 2015. Tesla Motors Quality Engineering Application and Implementation.
Motors, T., 2015. Tesla Model S. Palo Alto. Online verfügbar unter http://my. teslamotors.
com/de_DE/models/design, zuletzt geprüft am, 17, p.2015.
Rogerson, S., 2017. Is professional practice at risk following the Volkswagen and Tesla motors
revelations?. ORBIT Journal, 1(1).
Stringham, E.P., Miller, J.K. and Clark, J.R., 2015. Overcoming barriers to entry in an
established industry: Tesla Motors. California Management Review, 57(4), pp.85-103.
Tansel, A.K., 2015. Analysis of Tesla Motors’ Marketing Communications Strategy.
Voigt, K.I., Buliga, O. and Michl, K., 2017. Driving Against the Tide: The Case of Tesla Motors.
In Business Model Pioneers (pp. 187-198). Springer, Cham.