Case for Tesla

Question 1

Success Factors

1. Capabilities

• Product design capabilities: Tesla car have a cool appearance, ultra-fast acceleration, simple operation performance and advanced technology so that it becomes not only a fast but also a fuel-efficient car. Therefor, consumers are interested in this new high-tech car so that Tesla has achieved very high sales volume in a short term.
• Production capabilities: Tesla focuses on decreasing the environmental impact and reducing production costs.
• Marketing capabilities: Tesla choses the way of direct sales model and the company adopts experience store marketing, which only accept online orders.

1. Resources:

• Tangible Resources: excellent staffs and leaders, top automotive production lines, sufficient cash flow.
• Intangible Resources: In terms of brand, from the Roadster, Tesla Motors changed people's impression of the electric car. With the emergence of model S, Tesla received the increasing of demand and stock price. Moreover, company's production philosophy is green environmental protection, which can be seen from the car design. For technology, Tesla solves the main problem of electric vehicles, which is extending the battery operating time.

1. Value Chain Analysis

• Operation: Tesla is using automated processes to product the car.
• Outbound Logistics: Tesla Motors choses to open experience store to replace the dealer. People have to purchase a car from online ordering.
• Marketing and Sales: Tesla does not use traditional media to promote the car, instead use the Internet for publicity activities.
• Service: Tesla has its own service center and builds high-speed free charging stations for customers.

• Tesla also has excellent leadership team, good cooperative partnership and innovation technology.

How Unique

• Tesla obtained no-interest loan of $ 70 million, because more than 1,200 people reserved the Roadster (Frank, 2013).
• Tesla established a completely free car charging stations for the model S in US.
• The experience stores and online marketing is also unique in the automotive industry.
• Purchase pattern is unique, which provides different pre-payment for different models so that it can create a lot of cash flow.

Question 2

Competitive advantages

• Tesla Motors identifies the car not only the electric car. More importantly, it is a Super sports car. This is very important for their company, because most buyers are attracted by its cool appearance and performance.
• Tesla achieves from zero to sixty miles per hour only need 3.7 seconds, which is faster than Porsche 911 (Frank, 2013).
• Purchasing a Tesla car only need one hundred thousand dollars in US, compared with the price of the super sports car is very cheap (Frank, 2013). Therefore, low-cost electric vehicle is the main competitive advantage for Tesla.
• Technical advantages：Tesla has advanced battery management system and improve the battery capacity to increase the using time. In order to solve the battery problem, Tesla began to establish free high-speed charging stations in the United States.
• Social and Economic Environment: In recent years, as people began to pay more attention to protect environment and to develop the high technology products, so there is a large market share for electric vehicles. In addition, government offers many policy advantages to encourage and support electric car industry.

Reference List

Frank, T.R. (2013). Tesla Motors (in 2013): Will Sparks Fly in the Automobile Industry.