Foundation Degree: Tesla Electric Car Market Analysis (BMS 409)

This report examines Tesla's electric car market within the United Kingdom, beginning with a background of the company and its innovative approach to sustainable electric vehicles. It then provides an in-depth evaluation of Tesla's electric cars, such as the Model 3, assessing their features, market position, and impact on consumer behavior. The analysis includes a discussion of challenges like Brexit, competition, and high maintenance costs, alongside opportunities presented by government initiatives and increasing consumer interest in electric vehicles. The report concludes with strategic recommendations for Tesla to improve its market share, including pricing strategies, addressing maintenance costs, and expanding product offerings. The report is a student submission for a Foundation Degree in Business & Management, focusing on Innovation and Enterprise.

Foundation Degree in Business & Management (Year 1)
Innovation and Enterprise (BMS 409)
TITLE
I declare that this project is all my own work and that I have acknowledged all materials used
from the published or unpublished works of other people. All references have been duly cited
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Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Background of the company.......................................................................................................3
Evaluation of Electric cars of Tesla ...........................................................................................4
Recommendation........................................................................................................................8
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Tesla is one of the re-known brands in the world. The company sells various kinds of
electric cars in different places in the United Kingdom. Electric cars of the firm are well-known
and a large number of customers are attracted to it. The company faces various kinds of
challenges in selling cars in different places (Tesla, 2020). However, it has various opportunities
as the world is much focusing on sustainable product development and growth. The report
focuses on Tesla's electric cars in Britain. It also discusses various kinds of problems in
manufacturing and selling of product under critical analysis and in the end recommendation is
given for making changes to improve shortcomings and improve strength factors.
MAIN BODY
Background of the company
Nikola Tesla's well-known for electric cars introduction and pioneer in the world. It was
founded in the year 2003 by the engineer's group (Roper, 2020). This also proves that these
vehicles have a future and can be better than petrol cars which are polluting the world and also
very limited stock available in the world. Decreasing Non- renewable sources of energy was the
main reason for innovation and the idea of manufacturing electric cars by them. In 2008, the
company launched a premium electric Model-S, and hence company able to change the mentality
of people that sustainability can be possible. Elon musk which is well-known for innovation and
creativity become a co-founder at a later stage of and hence company again impoverished by his
plans for example Model3 was introduced by him at low prices to attract customer and purchase
its product (Tesla, 2018). The company also sell different other product such as Powerwall,
Powerpack, and Solar Roof. Company has innovated various kind of electric cars but all of are
limited to a few rich countries and hence expanding business company is trying to down the
price and launch new electric vehicles. The company also has a market in the United Kingdom.
And a large number of customers are attracted to its product. BREXIT and COVID become a
barrier in selling products of the firm in the United Kingdom. Also, a large number of people still
avoid purchasing its product because of the premium price and highly complex engineering that
increases the maintenance cost of the product. Coronavirus has a highly impacted life of British
and recession, inflation, etc. are hampering the growth of the firm, and is unable to expand its
market in a different part of the United Kingdom. However, the company is trying to push
business with a different strategy.

Evaluation of Electric cars of Tesla
Tesla is one of the rising automobile companies in the United Kingdom and it sells
various kinds of models such as Model 3 which are highly innovative and design for the next
generation. It is one of the cheapest electric cars that is launched by the firm to attract British
customers and increase its market share. This product is completely electrified (BEV) and fully
automated with advanced features. Because of extreme innovation and best performance of
innovated automobile won Car of the Year 2019 and also of 2020 and hence company's fame
continuously increased which helped in attracting a large number of customers and increasing its
market share. The company has various kinds of features such as attractive design, best comfort
level. Model-3 of the company's product is one of the safest cars on earth. Accident chances by
the car are very rare and it has also achieved the highest safety rating from the National Highway
Traffic Safety Administration (Hahn, and et.al, 2019). Automated mode of the car again
contributes to safe drive and hence passengers will remain sure when vehicles are passing
through different places. Battery power, capacity power of the car is very good compared to
other electric models of the same range and h
ence able to
become the first choice of consumers.

Designed of the car is again attractive which influence various kind of customer for
purchasing it. Supercharging is another feature that attracts people to purchase this vehicle. The
battery of the vehicle is charged quickly and remains effective till long times and hence it can
run for a long trip. It highly supports sustainable product development which is necessary for
changing business (Endsley, 2017). It also provides features of pre-cooling of the vehicle with
the help of a smartphone and hence passenger can save time and cooled the car before running it.
The seats of the car are highly comfortable which decreases the chances of back pain or any
injury and it increases customer satisfaction level (Stobbe Jr, 2019). The steering wheel of the
product is again amazing and also customers can watch various kinds of shows on Netflix,
YouTube, etc. There is a large number of charging stations increase in the United Kingdom and
which support for product run in the city and decrease going into few places and waiting for
charging for a long time. The green energy concept is highly promoted with this model and a
large number of customers are attracted to its purchase. After COVID, a large number of people
become health conscious and wants to purchase an electric car which gives opportunities for
providing and selling various kind of vehicles in the United Kingdom. It is observed that the firm
150% increase sales increase and hence a large number of British customers are attracted to its
product (Fred Lambert, 2020).
There is a various reason for the increasing market sale of the product such as promotion.
The company believes in mouth-to-mouth publicity which helps in gaining a large number of
customers in Britain. The government of the country also focuses on conserving the environment
in changing industrialization and hence all are moving towards electric vehicles (Talluri and
et.al, 2018). The UK is one of the technologically advanced countries which contribute to selling
of the electric vehicle. The government of the country is committed to decreasing carbon
emission and hence electric vehicle of Tesla will be the best option. The organisation has divided
products into subcategories or parts and hence increase profit by it. The premium price of the
product again distinguishes it from other brands. However, the firm thinking to launch a product

that can cover the middle classes also and hence working on it. The new range of electric cars
again attractive and helps the firm in increasing its market by more choices of products.
Designing is also highly used by the firm in gaining customers, especially of youth as most of the
youngsters are attracted to its products. Many celebrities use their cars and hence influence
others too for purchasing Tesla's Product. It becomes one of the rising electric brands in the
United Kingdom and assuming that soon it shook the market of the country with new products.
There are multiple challenges that Tesla is facing in running the business in the United
Kingdom. After Brexit, the inflation rate and the unemployment rate in the country increase, and
hence less number of people are interested in purchasing costly or electric cars. European raw
material cost increase because of an increase in customs duty and taxes and hence the company
unable to decrease the price of the product. Government new rules and regulations highly
support local organization such as for and hence the company faces challenges in it too.
Customers in the country still not welcoming electric vehicles because of reasons such as it is not
suitable for a long journey.
Electric vehicle maintenance costs are high and a large number of buyers do not purchase
because of it. The battery is not suitable for the long run for example charging stations are
available in main cities such as London and hence it cannot take to other parts of the country.
Ford's image is still in the mind of people and the first choice for purchasing an electric vehicle
because of the low price and support of the country's company (Lindgren and et.al., 2018).
Complex engineering again decreasing the market share of the firm and hence less revenue is
available for expanding business. The investor still is not much interested in investing in Tesla's
product which creates difficulty for expanding business in a different part of the country. The
company is limited to mouth-to-mouth publicity whereas its competitors use all forms of
marketing and hence able to generate higher revenue (Tomzcak and et.al, 2019). The profit of the
company is not as expected which means that Tesla was thinking that a large number of
customers will attract its product but on the contrary, there are very fewer cars sold as compare.
The company is located in few cities and also fewer services centers whereas Ford and
other competitors can hold their foot in different are of the United Kingdom. Services of the
company also not good such as customers have to stand in a long queue and hence unable to
increase customer satisfaction level. If the company has to grow in the United Kingdom then it
has to change its style of selling products and start promoting its product on an online platform.
The company has a very limited Model in the UK such as Model-3 and hence without
variety customers cannot attract (Tenhundfeld and et.al, 2020). It is still a foreign brand in the
mind of British customers, and they are more supporting local firms. The youth of the country
are highly interested in sports cars and with full speed but electric, not able to make the same
taste of the product. Tesla has launched Model-3 with low prices from other models in the
United Kingdom. However, its product is highly costly, and hence the mind-set of the people not
changed yet (Carney, 2018). There is a various company which is negative branding of the firm
for example company products are very costly and high maintenance cost and hence it decreases
customer share of the firm.
Business Model of Tesla
Organization provides safest drive automated car in the world which help it in
influencing large number of customers in country. Tesla also highly focused on removing
mediator in the business so that product will directly delivered to customer on time and increase

customer satisfaction level. Company has increase investment in developing infrastructure
related to vehicles such as superchargers station in UK. It is committed to increase in range of
product so that customer have multiple option and can support one stop shop habit of British
customer as well as able to support changing taste and trend in country. Sustainable development
is one of the priorities of the firm.
Recommendation
· Tesla is one of the big names in electric vehicle providers but to reach a large number of
customers, it has to give the product at low cost rather than maintaining premium price. The
company is only targeting upper-middle classes and a higher one but most of the purchasing
customers are available in mid-group and hence the company has to give products that can easily
be purchase by the group. It also has to provide large numbers of cars according to the changing
taste and trend of mid society. The premium price strategy of the company is one of the
biggest problems in reaching a large number of customers in Britain which are very much
attracted to its product. The company can follow a competitive price strategy to attract customers
and gain a competitive advantage in changing business.
· Maintenance cost of the product is very high which again affects targeted
customers'. Complex engineering in its model is one of the reasons that people avoid purchasing
it. It has to supply cars that have low maintenance costs and can easily be purchase by a large
number of customers. Companies distinguish from other companies in terms of high-level
engineering but it becomes a major problem when it comes to selling its product. According to
research, people avoid the company's product because of the high cost of maintenance, and hence
the company has to move towards simple engineering and low maintenance cost of the product.

The company has advance and strong-minded engineers and hence using them can tackle this
problem and increase customer satisfaction level.
· Company follows mouth-to-mouth publicity or customer experience-based promotion
which can attract a large number of customers but it can target only a few people or might be
created lots of confusion in front of others. It has to emphasize media as well as digital marketing
for promoting its product. There is a large number of people that are available on social media
platforms such as Facebook, Twitter, Youtube, tumbler, etc. and hence the company can take it
as a profit for promoting its product. It can also use a different celebrity for the promotion of its
product and organizing events can also help in gaining a large number of British buyers for the
firm's product. Media such as newspapers, magazines, radio, TV ads. Still influence many
people, and they find it more genuine and hence dual marketing can help the firm in attracting a
large number of British customers. The company can follow the strategy of mixed promotion on
three channels such as digital, media, and mouth-to-mouth which can help in increasing its profit
share and expanding its business.
·Company has launched a very limited Model in the UK such as Model-3 and hence
customers have less choice in purchasing the firm's product which decreasing its market share.
Ford and other competitors of Tesla's introduction under a budget model with range and hence
the company has to frame a strategy to counter them and gain market. The company has various
products that it has introduced in the USA and which are very attractive and hence supplying this
product in the UK market will be very beneficial for the firm. The design of the product also
highly matters to customers and hence the company has to provide a product that is stylish and
can influence all groups of people in Britain. British customer believes in one stop using
resources and hence various electric model can only become a powerful strategy to influence
them and increase market share in Britain. Taste and Trend of customers in Britain continuously
changes and hence becomes important for providing the product as per the demand of customers.
· Company is limited to a few cities in the United Kingdom whereas other competitor's
firms are situated at different places in the country and hence it becomes difficult for target
customers and increases market share. Maintenance centers are limited and hence it becomes
difficult for the customers to reach which decreases its customer rating and satisfaction level.
Tesla must have to open different stores at various locations to reach all customers in the UK and
increase the revenue of the firm. The company can also provide online call maintenance
services for example if the customer is under targeted diameter then service providers reach with
equipment and make or update require changes.
· Company has to frame its policy according to changing government guidelines then it
can only target British customers and increase its market share. The company has to understand
that UK citizens are reluctant to accept new technology and hence must frame a strategy that can
counter them and increase the market share of the firm. The firm has to launch its product on
the festival season or on a national day in the UK which helps in gaining the support of local
customers. Influencing customers online can also become a game-changer for the firm, for
example, messaging customers on birthday, festival, etc. can also help in improving the image of
the firm.
· Large number of British customers are resistant to change for example they do not like
electric vehicles. The firm has tried to understand that customers' perception change can only be
chances for expanding business and increase the market share of the firm. The company has to
frame a strategy in which different people in the country can address the electric vehicle's
importance and how to contribute to the sustainable growth of the environment.

CONCLUSION
It can be analyzed from the report that Tesla becomes a game-changer in the UK by
introducing electric vehicles. It becomes important for the government to protect the
environment from continuous pollution and hence electrified automobiles. Company sales hike
in July and a large number of consumers are attracted to its product. Tesla has long fame in the
British market and hence can attract a large number of customers. High engineering and high
battery capacity are some of the important features of the product which help in the long run of
the vehicles. The company faces various kinds of challenges in attracting a large number of
customers such as high maintenance cost, few locations in the UK, and hence becomes a barrier
to the growth of the firm. However, the company can improve strength and overcome
shortcomings by adopting a proper strategy like a promotion at all channels such as digital,
media, and mouth-to-mouth publicity.

REFERENCES
Books and journals
Carney, D., 2018. Not so fast: electric car: mazda has improved the gasoline engine to a level that
even tesla should respect. IEEE Spectrum.55.(8).pp.20-25.
Endsley, M.R., 2017. Autonomous driving systems: A preliminary naturalistic study of the Tesla
Model S. Journal of Cognitive Engineering and Decision Making.11.(3).pp.225-238.
Hahn, S.,and et.al., 2019. 45.5-tesla direct-current magnetic field generated with a high-
temperature superconducting magnet. Nature.570.(7762).pp.496-499.
Lindgren, T., and et.al., 2018, September. On the way to anticipated car UX. In Proceedings of
the 10th Nordic Conference on Human-Computer Interaction (.pp. 494-504).
Roper, L. David, and Tesla Model Y. Users’Manual. "Tesla Model Y." (2020).
Stobbe Jr, J.J., 2019. A Strategic Audit of Tesla.
Talluri, L.,and et.al., 2018. Design and optimization of a Tesla turbine for ORC applications.
Applied energy, 226, pp.300-319.
Tenhundfeld, N.L.,and et.al.,2020. Trust and distrust of automated parking in a Tesla Model X.
Human factors, 62(2), pp.194-210.
Tesla, N., 2018. My Inventions: The Autobiography of Nikola Tesla. GENERAL PRESS.
Tomzcak, K., and et.al., 2019, April. Let Tesla Park Your Tesla: Driver Trust in a Semi-
Automated Car. In 2019 Systems and Information Engineering Design Symposium
(SIEDS) (pp. 1-6). IEEE.
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Tesla’s mission is to accelerate the world’s transition to sustainable energy. Tesla, 2020.
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Tesla Model 3 = #1 Vehicle In UK, & Electric Vehicles Hit 34% Market Share. Dr. Maximilian
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