Presentation on Environmental Business Audit of Tesla Inc.

This presentation provides an environmental business audit of Tesla Inc., founded in 2003, highlighting its impact on the automotive industry with its innovative electric vehicles. The analysis includes a PESTLE framework examining political, economic, social, technological, environmental, and legal factors affecting Tesla's potential entry into the Vietnamese market. It uses a traffic light system to assess investment opportunities, Porter's Five Forces to evaluate the competitive environment, and a SWOT analysis to clarify Tesla's internal strengths and weaknesses. The presentation notes Vietnam's stable political environment, growing economy, and increasing demand for imported goods, which are favorable for Tesla. However, it also acknowledges challenges such as high import taxes, underdeveloped electric vehicle infrastructure, and potential environmental risks from natural disasters. The analysis concludes that while Vietnam presents opportunities, Tesla must address technological and environmental challenges to succeed. Desklib provides access to this presentation and other study resources for students.

Hello Teacher, i’m Hannah and today i with PRESENTATION ABOUT
ENVIRONMENTAL BUSINESS AUDIT
First u can seethe table of contents, which of 5 main parts:
Introduction
Tesla Inc was founded in 2003 by Martin Eberhard and Marc. Tesla also recognized
Elon Musk, JB Straubel, and Ian Wright as co-founders. While Tesla isn't a very old
company, it has made a tremendous contribution to the industry with a market cap
of around $28 billion. Tesla is a phenomenon in the automotive industry and has
literally changed the future with its innovative approach to the market. The
company entered the industry as a newcomer to the technology market, consuming
its assets and causing a major shock. Their release of the technology-based electric
vehicle made it a product propulsion system for the industry. It has been accepted
by customers for its many advantages, such as: lower gas costs, fewer mechanical
failures, and less pollution. As battery manufacturers continue to drive down the
cost per kilowatt hour, it has become affordable for the mid-range.
This presentation includes a PESTLE analysis to determine the favorable and
unfavorable effects of outside factors on the auto retail market, a traffic light system
to assess investment opportunities, Porter's Five Forces analysis to determine the
competitive environment, and finally a SWOT analysis to look at and clarify the
organization's internal strengths and weaknesses.
Macro-environmental Factors Analysis
PESTEL is a framework for thoroughly analyzing the operational environment of a
firm and formulating possible business strategies. PESTEL analysis is used in
strategic planning, marketing planning, the creation of new products or services,
and research (Vasileva, 2018). It is important to clearly state the purpose of using
pestle analysis and to list the components of the external environment analysis.

2.1. Political Factors
P stands for political. Politics can refer to a particular political scenario or to laws
that have an impact on businesses (Matovic, 2020). Vietnam is a neutral nation with
a peaceful political environment free of war or international disputes. The
legislation in Vietnam has not altered significantly after many years and the country
also enjoy excellent ties with USA. As long as Tesla operates in Vietnam, they won't
have to worry about finding employees or meeting their shopping demands, which
is a good indicator. Tesla's product import is now simpler and less constrained. (+)
- Nevertheless, the tax on bringing a foreign automobile into Vietnam is too high,
ranging from 54% to 74% of the car's worth. This raises the price of the Tesla
product, resulting in fewer people purchasing it, which has a negative impact.
Human Rights Watch (HRW) says that there are problems with free expression and
human rights in Vietnam, Tesla must address this since it may have an impact on its
operations and expose it to spurious litigation. (-)Political is yellow light.
2.2. Economic Factors
E stands for economic. Vietnam's economy has demonstrated extraordinary
resilience throughout times of crisis, most recently the COVID-19 epidemic, thanks
to a stable base. GDP growth is anticipated to drop to 2.58% in 2021 owing to the
appearance of the Delta version of the Sars-CoV-2 virus, before rebounding to 8.02%
in 2022 and 6.6% in 2023. (Man, 2023). In 2021, Vietnam's average inflation rate
rises to 3.23% year on year before falling below 1% in 2015. In 2015, Vietnam's
inflation appears to have steadied and is predicted to drop. For the following three
years, growth will slow to approximately 3.5%. This bodes well for the future of the
Vietnamese economy and the car sector.

In addition, the implementation of the socio-economic recovery and development
program in accordance with Resolution 11 of the Government of Vietnam with
specific solutions such as supporting workers to return to the labor market, and
solving employment decisions for workers were implemented synchronously at
enterprises across the country, contributing to promoting the economy's strong
recovery of the labor market in the second quarter of 2022. Thus, the
underemployment of labor has improved significantly with this rate gradually
decreasing respectively 2.46% in the first quarter of 2022 and 2.32% in the second
quarter of 2022. People with stable jobs will generate stable and high personal
income growth, from which the demand for cars can be born, and Tesla can profit
from it, and in the future. , more Vietnamese people will be able to buy Tesla cars.
(+)

2.3. Social Factors
S represents social. Vietnam is showing a tendency of having a large proportion of
the "young population," with an average age of 30-34. A growing portion of the
young population supports Tesla's workforce. Tesla primarily targets people in this
age range as prospective buyers. On the other hand, Tesla is a business that values
youthful talent, so this it's a good opportunity for Tesla(+)
Besides, due to Vietnamese customers' fondness for imported goods of excellent
quality from European and American nations receiving more and more attention,
the middle class in Vietnam is growing day by day. Customers in Vietnam will be
drawn to Tesla by the brand's repute and the advancements in automotive
technology. (+)

Social is green light

2.4.Technology Factors
T stands for technology. With the rapid development of digital technology in
Vietnam, Tesla can use it for online marketing and promotion on social media
platforms like Facebook, Instagram, etc. This helps Tesla connect with more
potential customers in Vietnam (Perera, 2017). Besides, digital technology is also an
important factor to help Tesla operate the system in the most accurate and
convenient way. Furthermore, technology enhances research and development
(R&D), making it possible for Tesla to make relevant and efficient decisions. (+)
Infrastructure in Vietnam: Technology in Vietnam cannot reach Tesla level, For
example, Vietnam currently does not have any infrastructure for electric vehicles,
does not have any public charging sockets, The lack of charging facilities in Vietnam
is also a cause of frustration for Tesla consumers and reduces their ability to buy
Tesla. (-)
2.5. Eco-environmental Factors
E stands for environmental. In Vietnam, especially in big cities like Hanoi and Ho Chi
Minh City, pollution is getting worse. Because all of Tesla's products employ
environmentally friendly electric energy, they may provide a good solution to this
issue. Vietnamese people may use less fossil fuel to generate their power and switch
to renewable sources like solar energy from Tesla. (-)
Flooding and storms are common natural catastrophes in Vietnam. Tesla’s product
suffers since all of its vehicles are electric, which is a drawback. When tragedies
strike, many people will worry about how well Tesla's goods work and operate. (-)
Environment is red light for Tesla
2.6. Legal Factors

L represents the law. In order to attract more international businesses and
investors, the Vietnamese government has created a number of policies to attract
more foreign investment and companies, such as ensuring the rights of investors
(Tien, 2022). This makes it easy for Tesla to open branches and establish branches
in Vietnam.
In addition, it is not difficult to get a visa to Vietnam, so Tesla can quickly send
managers and personnel here.
Contrary to the above advantages, tax is a factor that directly hinders Tesla when it
wants to penetrate the Vietnamese market. There are 8 different taxes that
imported cars must pay in Vietnam including import tax, excise tax, VAT,
registration fee, road maintenance fee, license plate fee, and liability insurance. civil
duty. Therefore, owning an imported car also means paying more than the
manufacturer's retail price. (-)
2.7. Traffic Light System
Because of its advantages for the environment, Tesla is backed by Vietnam's
economic, social, and legal aspects. Yet, political and environmental concerns,
particularly technology, continue to encounter numerous challenges when entering
the Vietnamese market for Tesla. This is generally a good indicator of Tesla's entry
into the Vietnamese market. With a steady pace of economic expansion, well-
restrained inflation, a rising GDP per capita income in line with rising living
standards for the Vietnamese people, and government preference for government
assistance to industry in developing technological sectors. If Tesla enters Vietnam,
the infrastructure system to promote market growth and offer information will be a
supportive environment for the consumption of Tesla's goods.

Micro-environmental Factors Analysis
- The automobile sector is a very dynamic business with its own set of obstacles, and
Tesla's success says volumes about its strategic competency and efficacy. Tesla
Porter's five forces analysis gives insight into a firm's current competitive position
as well as the future stronger position to which the organization may aspire. It also
aids in understanding areas of strength and identifying and improving areas of
weakness in the firm. Let us go through Tesla Porter's Five Forces in further depth.
Competition in the industry (Strong Force)
- Nowadays, the Vietnamese car industry contains a number of long-standing
brands, such as Toyota or Vinfast, a Vietnamese brand that has become quite
successful after only two years on the market with three products. has generated
bright spots in the industry when monthly goods make the top ten best-selling
automobiles, so when Tesla enters the Vietnamese market, it may have to fight with
these brands not only in terms of sales but also in quality. Let's go over the potential
forces in Tesla's competition analysis.
Weakness in the number of competitors in the automotive industry.
Strong competitor force in the same segment of the market.
Strong force of low switching costs for consumers.
After identifying the forces, let's look at how Tesla handles the market's strong
competition.
Tesla has an advantage over its competitors due to its innovative services and
integration with charging stations all around the world.
Lower costs and higher profitability are supported by supply chain innovation,
vertical integration, and a commitment to continual improvement. Reduced cost is
an appealing quality for gaining a competitive edge.
Surviving in this competitive climate requires an aggressive media marketing plan.

The threat of new entrants (Weak Force)
The threat of new entrants is a weak force in Tesla Porter's five forces model. The
high cost is a weak deterrent to new businesses: => Brand creation is costly since it
necessitates highly inventive and cutting-edge technologies. Electric car models
coming to Vietnam, such as the MG4 Electric, Audi E- Tron SUV, Mercedes EQS, and
MG Marvel R, debuted at the Vietnam Motor Show 2022 and are on their way to the
market. Yet, these automobiles are pricey and out of reach for the majority of
Vietnamese people.
Beside, the auto industry requires a fair amount of finance to operate, which is also a
weakness that directly affects production. Initially, it was difficult to produce such a
product in large quantities, making cost savings in production a challenge: from
importing raw materials to producing the most secure components, and marketing
to consumers.
Bargaining power of suppliers (Strong Force)
- There are a lot of suppliers in the automotive sector, according to the 2018
Automotive News list, five of the world's largest suppliers are Bosch, Denso, Magna,
Continental, and ZF Friedrichshafen (Chappell, 2019). Supplier negotiating power is
a powerful factor in Tesla Porter's five forces model. Tesla relies on suppliers for its
smooth supply lines.
- In recent years, the electric vehicle market has grown in a number of locations.
Clients may choose from a range of automobiles, including electric and traditional
fuel vehicles. As the number of electric car models from various manufacturers
expands and cost performance improves, consumers have more and more
alternatives. As a result, suppliers are today faced with the difficulty of meeting the
need for supporting the automotive industry's increasing innovations - electronic
vehicles and autonomous driving. The automobile industry is undergoing significant
transformations as it transitions from traditional vehicle production to more

technologically advanced goods. Tesla is one of the most successful young firms to
join the market as a result of these developments. The corporation increased their
revenue by selling its electric automobile (EV).
- According to Tesla the has only seven factories worldwide, none in Vietnam
(Tesla, 2023). One factor that makes suppliers strong in negotiations is that they are
dominated by a few companies. Tesla sources its products from multiple suppliers,
giving them a greater advantage when negotiating costs and prices. They also have a
negotiating advantage when switching costs, which are essentially fixed costs
buyers incur when switching suppliers, increase. Therefore, the lack of required
materials is a problem as material resources are not that plentiful. In addition, Tesla
faced “one of the toughest challenges in the supply chain”; due to low chip feed. This
forces Tesla to raise car prices.
Bargaining power of customers (Moderate Force)
Customers can influence how competitors compete for profit. In recent years, the
electric car industry has matured at various points. Customers can choose from a
variety of vehicle options, including electric vehicles and standard petrol vehicles.
Consumers have more choices as the number of electric car models from different
companies increases and cost performance improves. They have what is called a
contractual advantage, which allows them to charge higher quality products and
lower prices.The strength of customers' bargaining power often results in them
beating their competitors in the battle for profits. All of their efforts are driven by
customer expectations, giving them the advantage of controlling the price and
quality.
The power behind the customer's bargaining power builds when the company buys
in bulk and cuts costs. Even if they reduce their profits, which not only creates an
incentive to reduce the acquisition costs, but also lures the customer with added
value. The customer always thinks about what he wins. When they see the added

value of their purchase, it appeals to them more. If the company cuts profits, there is
an opportunity to increase's sales by attracting more customers, making it a wise
move to maintain or even increase the company's sales.
The threat of substitute products or services (Moderate Force)
When automakers make their product, they face the risk of being replaced by their
competitors. Tesla's overall challenge was to ensure that the quality and uniqueness
of their vehicles were more than enough to outperform the competition, regardless
of price. Customer loyalty is earned when a company offers quality resources at a
reasonable price. However, competitors gain an advantage if the product can be
substituted and the same user can be provided at a lower price of. This occurs when
products lack uniqueness and quality.
Tesla Model 3, a Tesla electric car model that will compete with many impressive
competitors in the $40,000 price bracket already in the Vietnamese car market,
such as: B. Vin Fast VF 8, Ford Mustang Mach-E, Kia EV6, Hyundai Ioniq 5, etc. . . The
table above shows that not only Vinfast but also Hyundai, Kia and Ford have
introduced their electric cars to the Vietnamese consumer market. Compared to the
Tesla Model 3, which is currently Tesla's most affordable model, the cars are even
more affordable and easily accessible to Vietnamese consumers. Although the
Model X and Model 3 already have some units in Vietnam, the price of the car can
reach more than VND 3 billion upon arrival in Vietnam, which is no small obstacle
for customers to try electric cars.