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Strengths and Opportunities
Tesla Motors, a leading company in the electric vehicle market, is poised to become a major player in the industry. Through a partnership with China Unicom and the establishment of more than 400 charging stations in 120 cities throughout China, they have made significant progress in expanding their reach. China Unicom is responsible for managing maintenance and electricity expenses, indicating promising growth opportunities for this collaboration. While obstacles such as technology and production costs have hindered advancements in electric cars, technological improvements are anticipated to improve vehicle performance and range (Sparks, 2014).
Tesla has a low theft rate, with less than 0.15 thefts per 1000 vehicles produced, thanks to technology that allows tracking and disabling of stolen vehicles (Plummer, 2014).
Having financial support from Toyota could increase trust in Tesla's delicate new brand, as consumers familiar with Toyota may be swayed by the partnership between the two companies.
Notable individuals who own Tesla cars include Steve Wozniak, Ben Affleck, and James Cameron (Jain, 2014). The increasing cost of fuel is putting pressure on consumers globally, with conflicts in Ukraine and Iraq potentially causing petrol prices to rise further in the short term (Johnson, 2014).
Weaknesses
Threats
Expansion - Tesla's ambitious plan to construct a $5 billion battery plant could potentially hinder the company's sales growth by the end of the decade (Randall, 2014).
Additionally, compared to other vehicles such as the BMW 535d sedan, Tesla's Model S has a very limited range of approximately 265 miles at a similar price point.
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Charging times for Tesla cars can be up to 10 hours and 44 minutes when using a household electricity outlet.
In order to support their expansion plans, Tesla will need to further develop their network of charging stations in their target markets.
Low costs duplicates – Tesla may face increasing competition from the growing electric vehicle (EV) market Trends – Sale figures for electrified vehicles have slumped in recent times due to the unviability of nickel hydride batteries.
Although nickel batteries are not used in Tesla products, the average consumers may not be able to identify the difference between lithium ion and nickel batteries. (Randall, 2014) Safety – Fears of fires and explosion from the battery may prove sufficient to disintegrate the brand image of Tesla’s products (Badkar, 2013)
Although encountering challenges, Tesla has established itself as a leading entity in the electric car industry through the revelation of plans for a $5 billion 'giga' factory designed to cut costs. However, this daring move could potentially deplete Tesla's finances amidst an unpredictable market. It is essential for Tesla to evaluate the advantages and risks linked to the 'giga' factory given the uncertain future of electric vehicles.
Despite having a similar price point to luxury brands such as BMW, Tesla vehicles struggle to attract consumers due to worries about driving range, charging speed, and brand perception. To enhance their appeal in Western markets, Tesla could leverage celebrity endorsements and showcase their partnership with Toyota in marketing campaigns. Furthermore, highlighting the use of lithium-ion batteries instead of nickel ones and emphasizing robust security measures to prevent theft can differentiate Tesla from rivals and bolster its market position.
Tesla's groundbreaking car theft prevention technologies distinguish it from competitors, showcasing the brand's quality and uniqueness. This advantage will help Tesla excel in the electric vehicle market. However, it is crucial to acknowledge that different markets may necessitate varied strategies. As Tesla expands in China, it must remain vigilant against cheap imitations that could potentially attract its customers. While Tesla is successfully establishing itself as a luxury brand, it must maintain consistent marketing efforts, especially through its partnership with China Unicom. This comprehensive marketing strategy serves multiple purposes - safeguarding against subpar products, strengthening Tesla's position in the Chinese market, and enhancing the brand's reputation.
By having stylized electric charging stations in the region, potential consumers may be more likely to consider purchasing an electric car due to the rising fuel prices. However, the presence of easily identifiable recharge stations could be the deciding factor in the purchase of a Tesla vehicle. With its advanced technology and resources, Tesla could capitalize on the lack of infrastructure by focusing on rapid recharging opportunities. Collaborating with city councils to create a model city and partnering with local firms for financial support to build a network of charging stations could be a strategic move for Tesla.
Tesla's brand can be enhanced by highlighting its robust corporate foundation to develop a premium image for consumers. Leveraging celebrity endorsements, rising fuel prices, and collaborations with Toyota will aid in establishing a strong corporate identity. The branding approach will also tackle potential risks from counterfeit goods, safety concerns, and market changes that may affect the company. Marketing efforts can address weaknesses like limited vehicle range and extended charging times to instill confidence in future improvements. Further analysis is needed to determine the best strategy for building the required factory and infrastructure to support Tesla's objectives - this should be Tesla's main focus going forward.
Bibliography
Badkar, M. (2013, November 7). Tesla Stock Is Tanking After A Third Model S In Two Months Catches Fire. Retrieved from Business Insider Jain, A. (2014, August 29). Celebrities that own a Tesla Motor inc Model S. Retrieved from Opp Trends Johnson, K. (2014, September 11). Exploding World, Cheap Oil. Retrieved from Foreign Policy Plummer, Q. (2014, September 1). Everyone loves Telsa motor S except thieves, Heres why
Tesla Motors: Strengths, Weaknesses, and Opportunities. (2016, May 07). Retrieved from https://studymoose.com/tesla-motors-swot-analysis-essay
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