Tesla Motors is an American company that designs and produces electric cars and powertrain components. Martin Eberhard and Marc Tarpenning founded Tesla in July 2003. Elon Musk joined at the Series A funding round and currently runs the company as CE.O. and chief product architect. According to Musk, Tesla’s mission is to create affordable mass-market electric vehicles to have a material impact on oil consumption [2]. The first model of Tesla, the Roadster was released in 2006 and received great publicity because it was the first electric vehicle with the performance of a sports car. Tesla focused initially on the high-end of the market, rich people that could afford luxury electric vehicles. Later on, after the crisis their focus shifted to the mass-market with its sedan and announced crossover model. Because of the financial crisis of 2008 Tesla was unable to attract new investments. The financial struggles they had during that period slowed their growth significantly. As from 2008 Elon Musk took over daily control of the company and became CE.O. During this period Elon announced that the production and sales of the Tesla Roadster sports car continued and that they would also start with parallel production of a new lower cost mass-market car. In the US, Tesla still struggles with restrictive protection laws that several states introduced to prohibit Tesla to sell their cars directly to consumers and only allow consumers to buy their cars through third party dealerships. Tesla will start to focus more on the European and Asian markets, since it there has a great growth potential. Tesla Motors and the Adaptive Cycle of Change After the announcement of the Roadster in 2006 and the first hundreds of Roadsters that were sold out within a year, Tesla moved into the Equilibrium phase of the Adaptive Cycle. After the production of the Roadster started, Tesla moved quickly into the crisis phase since they couldn’t receive any investments during the financial crisis and delays and costs started to increase. This situation asked for new alternatives since Tesla was almost bankrupt. Elon Musk replaced the CE.O. and invested millions of dollars of his money into the company. Subsequently he unveiled the new Tesla Model S on June 28, 2008, to attract broader publicity and gain more revenue. As with the introduction of a new model also entrepreneurship was needed again to place the model high in the market. With great product development Tesla managed to bring out an innovative electric car with the largest range and was awarded several times for safety, innovation, and sustainability. Next to great product development also the services that Tesla deliver to its customers are unique and profound. Tesla is developing a network of superchargers all over the world to make long trips possible for their customers. Customers with models that are suited for supercharging can load their batteries for free at the Tesla charging plants. This further adoption of electric infrastructure support (supercharge stations) will stimulate the buying initiatives for mass-market electric vehicles even more. Also, the new Tesla Model X that will be manufactured in the beginning of 2015 will attract the attention of more publicity and will target the mass-market. Tesla wants to maintain its position as industry leader in battery and electric powertrain technology. They also want to keep delivering technological parts to competitors such as Toyota and Daimler. Furthermore, they are expanding the infrastructure of charging stations of Tesla electric vehicles. And its goal as stated on their website is: "to accelerate the advent of sustainable transport by bringing compelling mass market electric cars to market as soon as possible" [4]. Elon Musk is praised for his great entrepreneurship at Tesla Motors. Since he leads the company Tesla Motors emerged into a pioneer of innovation and is taken by many other competitors as example to buy and use their technologies from. By remaining high service levels and meeting the expectations of future buyers of electric vehicles Tesla will move towards an even more stable phase of Equilibrium to remain there as crises are awaiting to strike again
Qu.2 Analyze the company’s corporate strategy (Hint: this is the company’s main strategy worldwide - FROM THE CASE)