Critical Analysis of Tesla's International Trade Management Strategies

This report provides a critical evaluation and analysis of Tesla's international trade practices. It begins with an introduction to international trade, highlighting its significance and the skills required for effective management in a global context. The main body delves into the specifics of Tesla's international trade, including the company's operations in electric vehicles and battery energy storage. The report examines three types of trade: import, export, and entrepot, and assesses key international trade and business issues affecting decision-making. These issues include tariff barriers, administrative policies, cultural diversities, political instability, location constraints, exchange rate fluctuations, ethical considerations, and challenges like terrorism and racism. The report supports its arguments with academic and professional literature and concludes with recommendations to improve Tesla's international trade strategies. This report is available on Desklib, a platform designed to provide students with AI-based study tools.

Managing International
Trade

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Critical evaluation and analysis of key international trade as well as business issues which
potentially affect business decision making................................................................................1
Literature for supporting arguments............................................................................................6
Recommendations.......................................................................................................................8
CONCLUSION .............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
International trade is referred to exchange of products as well as services among different
countries. As trading is a global practice which provides customers as well as countries an
opportunity which are to be exposed to products and services that are not available in own
countries or which could be more expensive domestically. For that it is important to manage
international trade through managers who runs business across global borders which requires as
a whole for new set skills by reassessing competitive advantage, evaluating diverse political
surroundings as well as legal structures (Alfiero, Christofiand Bonadonna 2019). As by
considering impact of various policies or regulations by assessing currency, sovereign credit and
other financial risks. This report is based on managing international trade of Tesla, which is an
American electric vehicle as well as clean energy company based in California. Company deals
in electric cars, battery energy storage from home to grid scales. This report includes critical
evaluation as well as analysis of key international trade and business issues that affects decision
making, academic or professional literature which supports arguments, recommendations along
with its conclusion.
MAIN BODY
Critical evaluation and analysis of key international trade as well as business issues which
potentially affect business decision making.
It has been critical evaluated and analysed that there are generally three types of export
trade, import trade and Entrepot trade which are implemented in carrying business practices
effectively along with that for earning more profits in business(Clayton, 2018). Various key
international trade that are as follows:
Import trade:
It is referred as a good or a service which are brought in one country and which is
produced in another. As various countries are related to import goods as well as services that
their domestic companies could not produce effectively or cheaply as a exporting country. In
general terms import trade could be referred to goods or services which purchased from one
nation country from another nation country. Import trades are considered to be backbone of
international trade. As if expense of company's imports is more than value of its exports than
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company will have negative balance of trade which is known as trade deficit. Some of objectives
of import trade are as follows:
 To speed up industrialisation.
 To fulfil domestic demand of company. To enhance standard of living.
Export trade:
It is referred as goods and services which are produced and manufactured in one country
and acquired by various citizens of country. This trade could be done by shipping, email,
transmitted in private luggage on a plane( Dang, Li, and Wang2020). And, if product is
manufactured domestically and traded in a foreign country, it is referred as an export trade. In
carrying international trade practices and operations export trade is considered to be an most of
important elements for carrying international trade practices. Export trade is carried to have
elements which h are as follows:
 For having sale of surplus production in company.
 For having optimum utilization of domestic resources.
 For creating and building employment opportunities. For having increase national income of company.
Entrepot trade:
It refers importing goods from a foreign country by carrying a purpose of exporting
goods and services of company to another country with a high price. As merchandised could be
imported as well as exported without paying import duties in entrepot trade. This trade is
considered to be an combination of both import and export trade and is also known as re export
practice of company.
As carrying international trade practices effectively there are some of issues which arises
in carrying of international trade effectively which affects decision making in business
operations of companies. As in terms of carrying international trade practices of Tesla, some of
business issues which arises and affects decision making of business are as follows: Tariff Barriers: These barriers generally indicates various taxes and duties which are
imposed on imports. As traders of host countries find it crucial to earn high profits rather
than selling products in host countries. As sometimes, to protect foreign products and to
promote domestic products, strategically tariff policies are formulated which straightly
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restricts international marketing operations. Sudden change in tariff rates or variable tariff
rates for various categories of products create uncertainty for traders to trade
internationally(Das, 2020). Anti dumping duties levied on imports as well as defensive
strategies builds difficulty for exporters. In terms of Tesla, for carrying international
trade company is facing challenge in their decision making as for transporting electric
vehicles to other countries there are various taxes and duties which are applied on
transporting that company faces in relation to earning profits for company. As high tariff
taxes creates a barrier in performing international trade for company effectively. Tariff
taxes as well as custom duties could create a barrier in performing international trade
practices in various countries which could result in decrease in profits. Administrative policies: As administrative policies as well as rule in host countries and
guest countries generally makes international trade marketing more crucial. There are
some countries in which company takes and have long formalities which exporters as
well as importers which have to be clear. As unfair dealings and operations to have
formalities creates different problems to international companies. As international traders
should have to accustom with legal formalities of different courtiers where they want to
carry their work. In terms of carrying international trade practices of Tesla, company
faces issue of having administrative policies in carrying out business practices in different
countries. As some of countries takes very long formalities which could proved to be
disadvantage for company in selling their cars across global limits. Considerable diversities: As various countries have their own unique culture as well as
civilization. And it sometimes impose some of problems for carrying international
market operations effectively. Global customers exhibit considerable cultural or social
diversities in relations of needs, preferences, habits, languages, expectations, purchasing
capacities, buying or consumption patterns. Social as well as personal features of
customers of various nationalities are said to be real challenges to understand or
incorporate( Dinnar, and Susskind, 2018). Compared to local as well as domestic
markets, it could be more complex to understand behaviour of customers of other
countries. In terms of Tesla, company is facing issue in determining considerable
diversities in cultures as well as diversities in their operations. As company could face
issue of diversities in different country's languages, buying potentials of customer. As
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there are expectations which are faced in markets in terms of customer's requirements,
preferences, languages and other aspects which creates difficulties performing
international trade practices of company. Political instability as well as environment: As various political, economical systems,
command economy or mixed economy are considered to be actual challenge which
international company have to face. As political atmosphere in different in various
countries offers opportunities as well as impose challenges to outer company. Along with
that government in various countries sets their own priorities, approaches and
philosophies to perform international trade. Some company adopts various restrictive
methods as well as liberal approaches to international business tasks. In terms of Tesla,
company could face challenge of political stability as well as economical surroundings
which plays as a barrier and creates difficulties in performing their trading practices of
electric cars(Donald, 2021). As various countries have different political stability and
economic environment so as a result could face business issues in selling as well as
manufacturing of cars. Location constraint: As performing international trade in foreign countries for longer
practices are crucial in nature. As in case of perishable products and services it becomes
a specific issues for international market. Exporting as well as importing services and
products through sea routes as well as making arrangements for effective selling
practices which involves more time as well as it contains risks. Segmenting or selecting
international markets needs marketers to be more careful. In terms of Tesla, company
could face issue of having a location constraint in establishing their manufacturing
factories of electric cars and its other products and services which are to be performed for
carrying international trade practices effectively. As for establishing trade practices in
outer countries it is important and determine and establish a location for company. So for
that company could face issue of importing and exporting in international markets. Changes in exchange rates: As every company in different countries has its currency
which is to be exchanged through currencies of other countries. Currencies are traded
each day and rates are to be subject of change. Various currencies like Indian Rupee,
European Dollars and so on are appreciated and discounted at national and international
markets against other currencies. In terms of Tesla, company is company could face a
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issue of having variation in exchange rate of different countries. As there are various
currency level in different countries so as a result it becomes difficult for Tesla examine
exchanges rates for their cars in corporate markets. As currencies are matter of exchange
it fluctuates constantly that is treated as a business issue carrying international trade
practices effectively. Norms and ethics issues: As ethics are referred as moral principles, norms and standards
of carrying governing individual as well as company's behaviours. Company is deeply
reflected in formal laws and regulations(Yuan, Hsieh and Su 2019). There are various
code of conduct which are specified that international business companies have to
observe. Along with that globalisation practices has emphasized in some common ethics
which are worldwide. In terms of Tesla, norms as well as ethics could be said to be
major business issue in carrying Tesla's international trade practices effectively as it is
essential to determine behaviours of different customers living in host countries and
according top that produce their cars according to customers( Esch, 2018). Tesla mostly
faces business issue in determining behaviours and ethical norms of business operations.
 Terrorism and racism: As terrorism is considered as a global issue and a global wide
challenge. So as to trade internationally is not considered economically risky but it carries
various threats to company. Along with that racism also creates a barrier and restricts
international trade operations. In terms of Tesla terrorism as well as racism plays as a
kind of business issue in performing trade practices of electric cars in host countries. As
Tesla is considered to be an expensive brand so it becomes more risky for company to
carry its international trade practices effectively. Along with that racism creates issues of
having racism policies in company's operations as it creates racism issues in carrying
business international trade practices of company in different countries.
 There are also some of challenges and issues which affects decision making of
international trade of company which are regularly changing ecological surroundings as
well as global warnings, Changes and diversification in weathers as well as natural
climates, inadequate role of international agencies which are supporting as well as
regulating international trades and variations in currencies that weights, standards,
measures as well as marketing methods(Woodsworth, and Williams 2018). In terms of
Tesla, company is could face business issue in carrying their decision making in terms of
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constant changes and diversifications of ecological surroundings of company's
environment practices as well as operations. Along with that regular changes in currency
rates could affect maintenance as well as revenue cost of manufacturing of cars in
different countries( Huang, Hsu, and Chen 2020).
Literature for supporting arguments.
As per the viewpoint of S. Jaideep, 2020, From this report it has been identified that
there are some of business which are faced by companies in carrying their international trade
practices effectively as in terms of Tesla these business issues affects carrying of international
trade practices(van der Laan, 2019). This literature supports that these business issues affective
working practices in different ways. As these business issues as well as challenges which
negatively affects working practices of companies and affects carrying of business practices of
international trade in corporate markets of various countries. These business issues are justified
and support and analysed properly. And its impact in terms of Tesla's electric cars are as follows: Tariff barriers: As carrying of international trade practices effectively sometimes trade
barriers like tariffs raise prices and decrease in available quantities of Tesla's product and
services for country's businesses as well as customers that outcomes in lower income,
decreased employment as well as lower economic output(Kinlaw, Kritzman, and
Turkington 2019). As tariff barrier results in lowering GDP, wages as well as
employment in long run of company. Administrative policies: As in terms of Tesla, administrative negatively impact
company's business practices in international markets as because some countries have
lengthier trade policies it affects Tesla in carrying fulfilling of formalities of carrying
business practices and trade in establishing their factories. Considerable diversities: As considerable diversities affects working practices of Tesla.
As for running business practices in Tesla effectively it is important for Tesla to
determine behaviours, attitudes as well as language and according to that company could
plan its international trade practices(Spear, 2018). There is an issue arises out in
identifying language, wants as well as preferences of customers that could help in
building profits for company. Political instability or environment: As political instability as well as workplace
discrimination could negatively affect business practices of Tesla in international
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markets. It is justified that for running business in global markets Tesla needs to ensure
that country should have political stability and along with that it should have proper
economical surroundings. Location constraints:While carrying international trade practices in markets location
constraints issues plays a crucial role in performing business practices of Tesla. As in
some countries company faces issues for location to establish their factories and as a
result problems will be occur in manufacturing of their electric cars as well as it affects
different operations of company(Kwak,Majewski, and Jellish, 2020). Variations in exchange rates: As when in Tesla, exchange rate changes as a result price
of their imported electric cars will change in value along with involving domestic
products which rely on imported elements as well as raw materials. As exchange rates
also creates an impact in investment performance, interest rates and results in inflation. It
could result in extend to a influence of job market as well as estate sector in different
countries. Norms and ethical issues: In this business issue of Tesla, different norms as well as
business ethics negatively effects working culture of company and its
operations(Ramady, 2018). As in different countries it carries different ethics which
should be followed effectively by company to carry their international trade practices.
But in some countries it is difficult to follows ethics for running their business.
 Terrorism and racism: As terrorism as well as racism are considered to be more
important business issues in carrying international trade practices effectively. As Tesla is
considered to be expensive brand and its electric cars as well as others products are
highly expensive. So as a result it becomes more risky for them to keep maintaining its
business practices effectively in international trade markets(Mgonja, and Poncian, 2019).
As a result terrorism will negatively impact on business operations along with racism
also creates challenge for company to carry its international trade practices effectively.
 There are also of other business issues as well as challenges which affects negatively on
business practices of Tesla which states regular changes in ecological
environment(Obeng, 2019). There is also a business issue of inappropriateness as well as
inadequacy in playing role international agencies of company which supports as well as
regulates international trades in global and international trading markets.
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Recommendations.
From this above report it has been identified that there are some of recommendation
which could be provided to companies for enhancing and performing their trade practices
effectively in global markets. In terms of Tesla, various strategies which are recommended to
company for enhancing their international trade practices which are as follows: Creating as well as designing a drawback responsibility schemes: Company is
recommended to create as well as design a duty drawback scheme and which could be
improved by making it accessible to indirect exporters as well as extending them to a
imported inputs which are used in production of exported final products. Along with
eliminating duty pre-payment methods for exporting companies in order to reduce credit
requirements. Enhancing availability of credit: As there is an availability of short as well as long term
credit is which is difficult to exporters. As company should use and implement strategy
of enhancing availability of credit that could help in managing international trade
effectively in company. Simplifying regulations: As government should simplify regulation which are related to
exports that includes long bureaucracy procedures and eliminating negatively affect with
new exporters. Improving cooperation between economic sectors: As besides traditional policy
instruments, export growth should be used in company to enhance cooperation among
economic sectors. Combining short term and long term export growth policies: Tesla is recommended to
use as well as combine short term and long term export growth policies for managing
international trade of company. As stimulation of export growth needs combination of
short as well as long-term policies. In these terms it is important to also exploit
complementarity among EPPs and other domestic policies. International standards: As company should use and implement international trade in
its businesses. As international trade community will simplify unwanted regulatory
challenges for developing countries. As by promoting use of international standards in
company's operations it will help countries to integrate into global value chains. As
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international standards usually embed global best practices, increased uptake of such
standards can help promote sustainable development. Regional trade regulatory convergence: As Tesla is recommended to push more
regional regulatory convergence, finding common answers to address their regulatory
requirements. As welfare gains would also be far higher for MERCOSUR if its key
trading partners, like EU, simultaneously converged to international standards. Regional
regulatory convergence should therefore be seen as a stepping stone for global
convergence. Technical cooperation and capacity building: Company is recommended to use
regulatory measures with technical cooperation along with capacity building which
requires to be enhanced that could help other countries in complying through regulatory
requirements and reduce procedural obstacles. Transparency:As for carrying and managing international trade policies effectively
company is recommended to have transparency in their existing regulations,. As leading
an international effort to gather and freely disseminate comprehensive information on
currently imposed non-tariff measures. International cooperation: Tesla is recommended to have international cooperation as
International cooperation remains critical to ensure a predictable and rules-based trading
system in which poor countries can reap market opportunities, generate employment and
reduce poverty. The present escalating trade tensions among larger countries are creating
uncertainty, undermining the multilateral regime and risk damaging the development
prospects of vulnerable economies.
 New economic models: Tesla is recommended to use new economic model for
developing and managing trade practices across global limits. As newly designed and
developed economic models provides help to company in building higher reach and
carrying business practices effectively constantly by increasing amount of profits and
revenues of company. Along with that economic models are used to carry business
practices effectively.
CONCLUSION
From above report it has been concluded that international trade refers carrying business
practices across global boundaries. International trade is carried in different countries so for that
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it is important as well as necessary to manage international trade practices in an effective
manner. This report critically evaluates about key international trade practices along with a
explanation of business issues that could create an impact on decision making of company.
Along with that this report provides a brief idea of arguments that supports academic as well as
professional literature that supports arguments. This report clearly explains various
recommendation which are provided in managing international trade.
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