Table of ContentsIntroductionOrganizational OverviewSWOT AnalysisStrengthWeaknessesOpportunitiesThreatsVRIO AnalysisValueRareImmutableOrganizedPESTLEAnalysisPoliticsEconomicSocialTechnologicalEnvironmentLegalPorter's 5 Forces AnalysisCompetitive Rivalry (High)Consumer Bargaining Power (Medium)Power negotiation of suppliers (Medium)The threat of substitution s (medium) The threat of new entrants (low) Integration of the external and internal context of the organization Major problems Current strategies Superior technology Supercharger networkSales strategyRecommended strategiesConclusionIntroductionThe United States has the one of the largest automotive markets on the planet. In 2018, light car sales in the United States reached 17.2 million units, the fourth consecutive year that transactions reached or exceeded 17 million units. Overall, the United States is the second largest market in the world for vehicle transactions and creation. In 2018, the United States sent 1.8 million innovative light-duty cars and 131,200 medium- and heavy-duty trucks (valued at more than $60 billion) to more than 200 industries across the planet, with tariffs additional costs for auto parts estimated at $88.5 billion. With an open speculation strategy, a huge buyer's market, an exceptionally talented workforce, accessible foundations, and incentives from local and state governments, the United States is the leading market for the automobile industry in the 21st century. Say no to plagiarism. Get a custom essay on "Why Violent Video Games Should Not Be Banned"? Get the original essay By mid-2018, the U.S. auto industry was in the early stages of what many saw as a crucial breakthrough in the way which individuals thought about and used vehicles. The next one would be overwhelmed by electronic and independent vehicles. Vehicle ownership in which individuals pay for a solid resource with all its fancy bells and whistles would offer an approach to individuals purchasing miles on shared vehicles. Tesla co-benefactor and Chairman Elon Musk envisioned his organization's electric vehicles driving the car to benefit the company's development. Regardless, the company was spending money at an impractical rate as it arranged for delivery of its first mass-market electric car, the Model 3. Many industry onlookers wondered whether Tesla would have enough money to stay above water and if Musk was the right pioneer. After a series of innovative victories, Elon Musk took a position of authority within Tesla Motors, an organization engaged in marketing fully electronic cars for the construction market. Tesla's flow item, the Tesla Roadster, is considered the leading all-electronic car equipped to supplant a fuel-controlled car due to its superior and adequate range. The report plans to focus on the broad outlines of Tesla Motors and how they entered the market in the United States. It intends to lead the SWOT examination to distinguish the strengths, gaps, openings, and dangers facing the organization (Sun, 2019). It also strives to direct the VRIO examination to recognize the Important, Imitative, Rare and association procedure followed by Tesla on the lookout. It is also to conduct the PESTEL investigation of the company to distinguish the political, monetary, social, mechanical, natural and legitimate powers that affect the company in the United States market. Healso conducts examination of Porter's five forces to recognize the dangers of suppliers, buyers, competitors and the dangers of new entrant organizations. Focusing on this investigation, it gives a concise overview of the important issues being examined by the organization and suggests techniques for the imminent future so that the company can stay on top. Exclusive passenger cars represented $270 billion in 2016 at the retail level. In 2008, the industry experienced a slowdown. Millennials have flocked to dealerships. Tesla was founded in 2003 by engineers. They wanted to prove that people won't have to compromise to drive better. Tesla consists of 9 board members who have close ties to Elon Musk. In 2018, several managers left. Worldwide, Tesla employs 34,000 people. There are also another 1,000 workers working at the Nevada-based Motor and Battery Gigafactory. 10,000 employees work in Tesla's manufacturing plant located in California. In 2010, Tesla went public. At that time, the price was $17 per share. The stock was trading at $335 in August 2018. Tesla's market capitalization was higher. In March 2013, Tesla reported reporting profits in the first quarter. In 2016, it also reported a profit in the second quarter. Tesla investors were concerned about its long-term visibility. Tesla builds electric vehicles, scalable storage products and clear energy production. Three U.S. automakers accounted for 46 percent of the industry's market share, or 46 percent. This included the market share of Ford, General Motors and Chrysler. In the United States, 3 million people were employed in the automation sector. Brand loyalty is expected from customers in the case of efficient cars. Tesla's mission is to accelerate the world's transition to sustainable energy. According to Tesla, people need to rely on zero emissions rather than fossil fuels. We must prevail for a better future. There are different models such as Tesla Model X, Model 3 and Model S. The product range has been expanded to satisfy as many customers as possible. Tesla, by focusing on the niche market, entered the automobile industry. At the beginning, Tesla faced quality defects and technological problems. Tesla won Motor Trend's Car award for the Model S. Huge sets of components were produced by Tesla rather than supplying them to suppliers. The Model 3 is considered the least expensive product and has a battery range of 310 miles. There are various competitors to the Nissan Leaf and Chevy Bolt, such as Tesla. At present, Jaguar -I -Pace and BMW i3 are its main competitors. Tesla manufactured the cables, power electronics and battery itself. It has been predicted that 605 exclusive vehicles could be sold in the United States by 2025. New entrants have invested more in mobility services and electric vehicles. It was projected that profits and revenues could be shifted through the mobility service. Tesla's Model X is considered the fastest and safest vehicle. In the multi-day program, Tesla employees participate. This is done to ensure the safety and training of workers. It’s about making rapid improvements within the organization. In the United States, Tesla consists of 76 service centers. SWOT Analysis Strength Brand Loyalty Huge Product Line Innovative Tesla has many strengths that have enabled it to generate maximum revenue. One of hisstrengths lies in its brand loyalty. Since it is a niche market, customer satisfaction is high. Tesla's product line is also extensive, which has increased brand loyalty. The Roadster was Tesla's first car. The Model S, Model X and Model 3 are part of its product line. This allowed Tesla to match sales of the BMW 7 and 6 series. An attempt was made to sell the Model 3 as mass production. It is considered as one of the renowned innovative companies. In 2016, Elon Musk revealed the development of a vehicle. It is an autonomous vehicle. The production line is tested before a car is introduced. The production of seats is outsourced to satisfy customers. Customers expect to get more technological and cost-effective products from Tesla. All these aspects enhanced the organization's brand. Weakness Battery shortage Complication in manufacturing Tesla faces two major weaknesses. One is battery shortages and the other is manufacturing complications. At first there were some technical issues where manufacturing created problems. Production delays halted manufacturing of the Roadster. It has become difficult to manage suppliers (Ajitha and Nagra, 2021). When the Model X was launched, there was also a manufacturing problem. The supply of batteries has become limited. This decreased Tesla's production rate. The dealer lobby hindered the expansion of the company concerned. Issues regarding component quality were also recognized. Many improvements are required in order to maintain its position in the competitive market.OpportunitiesSales expansionLow-cost car modelsBased on Tesla's website, it has 111 stores. Stores are located in 26 different states. The company is working hard to expand globally. In 2019, Tesla operated 11,000 Superchargers and 1,300 charging stations. In the United States, Tesla has 76 service centers. Thanks to this, Tesla gains more market share. Its future growth is positive. The company aims to build cheaper cars. The focus on zero emissions has also increased its sales growth. Although Tesla stocks Tesla, the cars were sold instead of relying on other dealers. Threats Competitive Market Customer Adaptation Tesla also faces threats that require adequate improvement. The competition is tough. Ford, General Motors have also been Tesla's competitors. Currently, the Jaguar I-3 Pace is one of the main competitors. Other brands also offer low-cost cars, which poses a threat to Tesla. The success of a business depends on adapting the nature of customers (Khan et al., 2021). Tesla relies on consumer will because the same service is provided by other companies. The VRIOValuableValue analysis is established in the case of Tesla. All of Tesla's financial resources are valuable. Its brand image is an influential source of competitive advantages. Through innovation, manufacturing eco-friendly cars and considering zero emissions, it has established its position. Batteries are prepared within the organization. The cars are sold in their stores and do not depend on outside dealers. Tesla employees are also extremely valuable. There are approximately 34,000 employees. Apart from this, more than 1000 workers work in the battery and motor Gigafactory. Development and research aimed at improving customer expectations is also valuable. Self-driving cars have been planned by Musk, which hasadded to the value of innovation. Employees with good customer relationships improve Tesla brand loyalty. Tesla is valuable because the consumer experience can be controlled. In this case, the competitive advantage is permanent. ScarceEmployees and financial resources are considered scarce compared to Tesla. The workers here are extremely trained. Training programs are provided to make workers more competent. Thanks to this, a better quality of service is delivered by the company concerned. Financial resources are not provided by most other companies. Tesla is the only company that does not depend on outside dealers. She sells the product from the store itself and does not use independent third parties. Brand expansion is not uncommon. Other brands also target the niche market to maximize their revenue. In order to increase brand value, other automobile industries do this. Global presence is rare because Tesla has a significant market position. It is mainly preferred by customers because eco-friendly and technical products and services are offered. Immutable Pricing strategies are easily immutable. Low efficiency model from Tesla manufacturers. Its competitors also do this to attract customers. Brand loyalty and global presence are immutable. Competitors, by using similar market plans, can improve their brand loyalty (Vargas-Hernández and Garcia, 2019). This can lead them to expand globally. Employees are also immutable. Competitors can also retain workers and maintain effective training. Here, the competitive advantage is temporary. In terms of product range, other automotive industries are also working on design and efficiency. It turns out to be compatible, leading to a less positive outcome for Tesla. OrganizedTesla is one of the automotive industry's leading organized companies. Tesla focuses on customer education. This is done to make consumers aware of its different product lines and its way of working. The market position relative to Tesla is superior. Thanks to Tesla's high innovation performance, it has become stronger. Tesla's employees and financial resources are organized. This allows the company to provide better quality of products and services. 85,000 copies of the Model 3s were manufactured by Tesla. All works are organized to generate greater profit.PESTLE AnalysisTesla's decision to enter the automobile market in the United States was marked by various factors. It is important to understand the external business environment of the relevant market so that Tesla can understand the opportunities and threats the company faces (Liu and Meng, 2017). Political Factors - This will help identify the government's impact on Tesla's business and the macro-environmental factors associated with it. Impact - The US government has shown keen interest in the development of electric vehicles. Additionally, the country is currently experiencing political stability and has successful new global trade agreements. The political environment favors Tesla's entry into the automobile market. Economic Factors: This will determine how the economy can affect the business of a country. Market growth, currencies and trading levels are some of its measuring bars. Impact – The battery cost of electric vehicles has decreased with the increase in the number of users. Renewable energy resources also don't incur much cost. However, the stabilityeconomical is not possible and this could pose a threat to Tesla. Social Factors – These will determine how the trends of a particular society, as well as consumer behavior, can determine the external factors of a company's business environment. Impact – The case study used in this report highlights the current business situation and market of the United States, which clearly shows a need for electric vehicles as well as autonomous driving, connectivity, etc. These have allowed Tesla to establish a stable place in the automobile market as they are able to meet consumer demands (Dibble, 2018). Apart from this, wealth distribution has improved in developing markets, which is also an opportunity for Tesla. Technological factors – These will determine how technological innovation has affected businesses in a country. In the automotive industry, this is particularly visible. The impact: vehicle electrification as well as demand for connectivity in the United States has increased in recent years and the only supplier has been Nissan with its LEAF models. Tesla has an opportunity to innovate and enter the market by offering its own electric vehicles by leveraging technological development. However, they also need to keep up with the ever-changing technology in order to stay ahead in the market. Environmental factors – These will determine the impact of the environment on global trade. These include global warming, climate change and organizational responsibility to take sustainable action. Impact: Tesla has the opportunity to promote its electric vehicles to address climate change and carbon footprint issues (Schmid, 2017). Legal factors: These will determine the extent to which certain regulations and rules relating to a country's trade and business affect its activities. Impact: International patent protection laws have expanded, as have regulations on energy consumption. Both pose opportunities for Tesla, while sales regulations in the United States may pose a barrier.threatening issue for the company.Porter's 5 Forces AnalysisTesla's strategic steps can be improved by analyzing the factors related to the The company's external competitive environment in the United States. Porter's 5 forces analysis will aim to examine the factors that can affect Tesla when entering the American market. Competitive Rivalry (High) Although the U.S. automobile market does not have many players, existing companies are aggressive enough to compete for their respective position in the market. According to the study used in referencing this report, the Nissan LEAF was the only competitor in the market to Tesla and their electric vehicles can successfully enter the market all things considered (Kim, 2020). However, competing firms, even if few in number, are particular in innovation and promotion and an additional threat is low barrier or low switching cost. Bargaining Power of Consumers (Medium) Consumers are important to any business, but the auto industry is not. entirely dependent on the bargaining power of consumers. The threat is therefore relatively moderate. Switching costs have been identified as low and therefore barriers to purchasing from other companies are low – this is a threat. However, the availability of substitute products is moderate, leaving the consumer with few options. Power tosupplier negotiation (medium) Forward integration, level of supply, and size of suppliers are all moderately threatening in terms of suppliers' bargaining power over Tesla. Supplier sizes are medium and therefore do not have much impact on the automotive industry as a whole (Sull and Reavis, 2019). The bargaining power of suppliers does not necessarily have to be the primary concern of the company in its strategic management system. Suppliers often use third parties to enter into supply agreements with Tesla, which reaffirms their position as not that threatening to the company's business. The Threat of Substitutes (Medium) There are not many companies that can pose a threat to the company at present and to Tesla. can't find many companies capable of replacing its products. The competitive factor in Tesla's automobile market is that switching costs are low. The substitutes that exist on the market are very few in number and generally do not work well enough for consumers to turn away from products made by Tesla. This threat is therefore relatively medium. Threat of New Entrants (Low) After studying the competitive market in which Tesla is going to operate in the United States, it was understood that in the automobile industry, the threat of new entrants is relatively low. There are a few factors working in favor, such as brand development costs, business development, as well as high economies of scale, all of which hurt the prospects of new entrants in the market. Economies of scale benefit established companies like Tesla and it is difficult for any new entrant to beat them. Integration of the external and internal context of the organization In order to truly assess the state of the market that Tesla has entered, it is important to study the internal environment of the company in relation and integration with the external environment. The external environment includes political, economic, social, technological, environmental and legal factors and the internal environment is understood by studying the strengths, weaknesses, opportunities and threats of the company. Tesla is an established company and therefore many consumers are loyal to their brand. . They also offer a wide range of products and services and have made many profits by constantly reinventing and innovating their products. In 2018, Tesla had only 0.2% market share, which was relatively low compared to Ford and Toyota. Some of their weaknesses relate to their electric vehicles and the main problem has been the lack of battery power. The manufacturing system itself has also been identified as being slightly complicated, especially when it comes to electric vehicles that are very popular in the United States and are one of Tesla's main products (Thomas and Maine, 2019). However, the low switching price has made the market very competitive for the company, regardless of the issue of consumer behavior and adaptability. Tesla can maximize the opportunities available to the company in terms of sales and prices of vehicles produced. Political factors reveal an environment in which government investment in electric vehicle manufacturing has increased. Around 5% of revenue was invested in research and development of electric vehicles. The government has also entered into global trade deals that can further help Tesla sell its cars. Economically, the threat of instability can aggravate the price problem withTesla. Tesla has a strong supplier base where more than 11,000 companies have identified themselves as automotive suppliers. The fact that Tesla cars are expensive, which hinders the competitive pricing strategy, will not be improved in any way. The automotive supply industry is currently worth $2.2 trillion. However, the costs of batteries, as well as renewable energy, are currently very low, which may help Tesla change the pricing structure of its products. The threat of consumer adaptability has been identified as an internal problem, but its external analysis can be difficult. said consumer behavior is changing rapidly. Social factors show that consumers are increasingly interested in low-carbon lifestyles and therefore want to opt for more sustainable processes. This can open up several avenues for Tesla in terms of consumer adaptability and change the course of the problem from a threat to an opportunity. Technologically, the speed at which it advances and evolves can be both a threat and an opportunity for Tesla. . Considering internal factors, Tesla seems to have no problem investing in innovative aspects and reinventing the models they manufacture and release to the market. If Tesla can continue on the path of innovation, it may not pose a threat at all. Environmental factors have only contributed to the opportunities Tesla already has in the market. The company is looking to expand globally and hence can use environmental factors and promote its electric vehicles in the market so that consumers can benefit from more sustainable options. Legal factors can only be threatening in the case of Tesla if sales regulations are respected. in the United States do not meet their requirements. In all other cases, patent protection and energy consumption standards may contribute to the opportunity to build cheaper cars for Tesla. Major Problems Some of the problems faced by Tesla Motors are as follows: Under capacity generation: Fremont manufacturing office also as the Gigafactory has not been able to operate at its full volume. Under such circumstances, automakers turned to conventional manufacturing, something Tesla failed to do. Expensive Autopilot Component: The autopilot system created by Tesla uses cameras and photographic processors instead of the viable mapping advances and laser locators used by General Motors, which has occurred at high budgets. Automakers like Cadillac and General Motors have successfully rolled out their own hands-free innovation, boosting Tesla's modest advantage. Liquidity crisis: despite strong advertising capitalization, Tesla is concerned about the question of money and currently sells around a billion each quarter. Tesla is not good at creating on a large scale due to the blockages encountered in the Gigafactory which, however, has not managed to reach its full volume of work. Failure to conquer mass markets: Tesla failed to stop the framework is presented in the reports of electric car deals on the justification of high costs which contribute negligibly to a small 1 percent of the total global deals . This deprives him of the frugality of benefits of scale. Inadequate Billing Basis: The promotion offers created by Tesla can be considered profoundly insufficient when considering the generation and organized agreements. Tesla is stuck with the overwhelming task of creating inat the same time a charging organization alongside car generation. Legal Struggles: Legitimate struggles to specifically offer its electric cars are another fight Tesla Motors faces as they involve gigantic expenses. Delays in Shipping Items: Tesla has regularly faced the problem of delays in satisfying transportation to customers and, at times, shipping of unused cars has been essentially delayed. In addition, Tesla has taken into account aspects related to customer safety requirements regarding the use of electric cars. There are concerns about battery life and accessibility of the charging base. A man shows it: Tesla is currently respected while a man seems to be followed by Musk Elon who must regulate everything at Tesla other than consecutively other wanderings like space. and city based on the sun. This must have influenced Tesla to some extent, because the administrative skills of other qualified people were not used effectively. Mechanic Finding Issues: Even though electric vehicles require less support and less maintenance, it is still imperative to find a competent worker in the range. Unfortunately, 97% of repairers are not competent to make an effort on electric cars. Of the 3%, that is to say, many of them work for authorizations. Even though there is a portion of crossover cars on the street, they require maintenance services comparable to common gasoline cars. This implies that experienced people working on crossover cars are not necessarily familiar with fully electric replicas. Shockingly, electric car owners have fewer alternatives for competent mechanics, making them less in demand in U.S. advertising. Current Strategies Martin Eberhard and Marc Tarpenning, engineering entrepreneurs, founded the famous and successful Tesla company in 2003. The company experienced costs for the first time. surpasses the limits by producing the Roadster which was the first electric vehicle. The company's differentiation strategy is to play long term by focusing on battery technology, electric automobile automation and environmentally friendly services and products, but in case of entry into the industry American automobile, they have different strategies. Tesla's master plan is to penetrate the high end of the US auto industry market, where customers are willing to pay more, but by driving the market down they will lower the prices of each of their models ( Teece, 2018). The first attempt was the Model 3, which was aimed at mass production in the American automobile industry. They had several strategies before producing the model in the competitive market. Even though their current strategies are also similar to those of the past, small improvisations have been made to succeed soon in the American automobile industry. Their current strategies are as follows. Superior Technology Tesla plans to make its electric vehicles superior to other competitors. Their strategy is to equip the motors with exclusive magnets which will make them efficient and less expensive. Their goal was to focus on niche markets to gain access to the automotive industry. Their first model, named Model 3, was the cheapest model and even recent models are also available with a range of 310 miles (Sull and Reavis, 2019). This strategy results in more profits in their business. The company's energy storage system iscomposed of individual lithium-ion batteries and they are installed in the bottom of the car so that they can be easily handled (Offer, et al., 2020). Model 3 indeed had an energy density 14% higher than that of the others. The company planned to manufacture the batteries and motors in its own Gigafactory and started with its first model known as Model 3. As a result, the time required to manufacture the batteries was reduced from seven hours to 17 minutes . long-distance driving is not possible with electric vehicles. Tesla has put an end to this misconception by implementing the strategy of developing networks of superchargers which are supercharging stations and these stations offer fast charging in the range of 50% in around 20 minutes (Thomas and Maine, 2019 ). However, other electric vehicles cannot access Tesla's Supercharger network. Sales StrategyTesla is not only concerned with producing models, but also aims to sell them successfully. So the company does not depend on resellers to sell its products as other companies follow. They have their stores where they have appointed salespeople to sell their cars and Tesla has its own 111 stores in around 26 states from Washington DC. This strategy is considered the most effective because the company receives more responses by selling its cars through its stores. in the United States. Tesla's recommended strategies by focusing on core competencies and at a similar time should study the suitability of work that will offer assistance in representing receptivity to the outside as well as the inside atmosphere ( Musonera and Cagle, 2019). With compelling replicas to showcase, Tesla is expected to accelerate its move toward the center, which is likely to yield superior results. Tesla would like to build its strategy on modest elements and see that other automakers with solid financial assets can move to electric cars. in a short period of time. The rise in natural tariffs, the government's expansion towards sustainable transportation, the increase in oil royalties and the rise of electric cars show that electric cars aim to become the vehicle sector in the long term (Dana, 2018). Tesla needs to focus on different markets in the United States and by fully arranging its production area in different regions, it should focus on adopting a low price management strategy in these markets so that it can offer to the market mass. the Model 3 generation that grasps the key to victory and by engaging in the mass showcase, it will offer assistance to customers marked in the United States, making a difference to achieve economies of scale. The dominant business model of offering directly to customers needs to be adapted as it poses a barrier to business development and also has some recorded claims contradicting Tesla. Tesla should be a fashion company and jointly get involved to fuel its development. Tesla has refrained from engaging in a forceful promotion methodology which can be seen as one of the reasons why buyers are worried about electric cars. A coordinated presentation communication technique would enable Tesla Motors to achieve greater product permeability and lead to greater product awareness. Tesla should continue to focus on investigation and improvement and continue to create things like Powerwall that strengthen its maintainability identifications. Tesla has often faced the problem of delays intransportation satisfaction to customers and sometimes the shipment of unused vehicles was significantly postponed. . Tesla encourages questions related to safety considerations from customers regarding the use of electric cars who are concerned about battery life. Tesla should focus on this generation issue and should enable the generation to manage quickly by using more talented workers, something else it will need compared to other competitors. Tesla is now respected as a single man because it is also controlled by Elon Musk who runs everything in the company and, therefore, influences the administration capabilities. Tesla should focus on this problem and hire the best supervisors to create an administration that would take its business to a diverse level. The presence of a satisfactory charging base is deeply significant for Tesla. The charging stations created by Tesla are considered deficient, so Tesla should focus on this problem and quickly accept the gauges to create adequate charging stations across the United States to strengthen its interest in the American market. Tesla should focus on expanding its creation limit in Fremont and Gigafactory. otherwise, it won't generate enough deals for the organization to stay on top. The autopilot system created by Tesla uses cameras and PCs, as opposed to advances in practical planning and laser radars used by large-scale motors, which has resulted in significant expense. It should focus on consolidating productive advances in planning and researchers as this would reduce the cost and end up being very useful to customers and increase its interest in important highlights. Despite its strong market capitalization, Tesla is concerned with money matters (Ladonlahti, Laamanen, & Uotinen, 2020). It was not possible to achieve huge reach due to the blockages observed in Gigafactory which has not yet had the opportunity to reach its full operational limit. Tesla should really focus on this issue and try to eliminate the problems associated with the creation of Gigafactory because there is no point in having a strong market cap in case it remains unused. Tesla must address two significant shortcomings. One concerns battery deficiencies and the other concerns manufacturing drawbacks. Early on, there were a few specific issues where assembly was problematic. Creation delays stopped production of the Roadster. It has become difficult to deal with suppliers. The supplied batteries have become restricted. This slowed down Tesla's pace of creation. The entry of sellers has hindered the expansion of the concerned organization. Problems with part quality were also recognized. Many advancements are required to maintain its position in the serious market. Tesla should focus on its shortcomings and improve by improving its battery life and other related assembly intricacies. Regardless of the fact that electric vehicles need less help and support, it is still fundamental to find a competent worker on hand (Lugtu Jr, 2019). Unfortunately, 97% of stationary people are not able to try electric vehicles. Of these 3%, several of them work for approvals. Even though there is a wide variety of vehicles in the city, they need maintenance organizations similar to regular gasoline vehicles. This suggests that people educated and used on multi-variety vehicles are not copies.