Tesla Motors is an electric vehicle manufacturing American company. Elon Musk, Martin Eberhard, JB Straubel, Ian Wright, and Marc Tarpenning founded Tesla Motors in July 2003. The headquarter of the brand is located in Palo Alto, California.
Tesla was a startup in Silicon Valley. The mystery behind the name of Tesla is a symbol of paying respect and tribute to the famous physicist, innovator, and scientist, Nikola Tesla. AC and radio technology are some of his major achievements that revolutionized the whole 20th century.
Tesla Motors earned the reputation of providing the automotive energy solution to customers. The company is also popular for its innovative and creative approach in the automotive industry.
Tesla offers some of the following products and services like Energy Storage battery packs, Retail Merchandise, Tesla Motor Vehicles, Financial services, Solar panels, Auto services, and lifestyle products.
Tesla’s annual revenue was 28.176 billion dollars by the end of 2020. Out of which the net income of the company after minimizing all the expenses was 533 million dollars.
Tesla’s main competitors are the 2018 Volkswagen e-Golf, Nissan Leaf, Hyundai Ioniq EV, BMW, Chevrolet Volt EV, and Kia Soul EV.
Here is the Tesla Swot Analysis in detail;
Check out the major strengths of Tesla Inc.
Innovation & Creativity
Innovation and creativity are the top traits of Tesla Motors. Fully electric sports car and semi-truck are some of the latest innovative automotive products. The customers’ market of Tesla expects the latest innovative product from the company. It helps the company to be competitive and gain financial advantage from its creative products.
InsureMyTesla is the latest insurance plan of the company by partnering up with the Liberty Mutual Insurance company. It helps the company to diversify its business and sales.
Won the Electric Vehicle Market
In 2019, Tesla sold 187,971 of its Model 3 vehicles. Chevrolet sold 155,477 of its vehicles the same year. Model S of Tesla sold 134,392 of its vehicles and earned the third position. That’s how Tesla is winning the market share by selling its maximum cars.
The Model S of Tesla covers a distance of 600 Km in a single battery. Opel Ampera, the same competitive brand, offers a single battery coverage of 520 Km. That’s how Tesla is showing and proving its strength in the electric automotive industry.
Top Automotive Brand
The retail of Tesla Motors was roundabout more than 367500 in 2019. The company has faced many issues the same year, but the company sold maximum vehicles. It’s because of the brand’s combined element of luxury and innovation technology.
According to a report by Forbes, Tesla attracts the attention of young job seekers and innovative people. They even consider the company an ideal workplace. The brand earned the status of Best Employer Award in 2019. It’s one of many reasons behind the success and growth of Tesla in a very short time.
Here you can find Weaknesses of Tesla Inc.
One Man Show
Elen Musk is running the company, Tesla Motors, as the one-man-show. It’s no doubt he’s a very talented and skilled professional. But his mind is occupied with other activities like launching a space vehicle project of the Boring Company.
Unable to Fulfil Batteries Demand
Elen Musk has admitted that the production and manufacturing rate of Tesla are slow. It’s because of the short supply of batteries. The shortage of batteries is negatively impacting the sales of the company.
It’s no doubt Tesla is a lead manufacturer of electric vehicles. But the brand doesn’t launch a mass volume of vehicles like other automotive companies. It’ because the company has invested a plethora of resources in the expansion of Gigafactory 1.
More Demand Than Production
The demand for Tesla’s automotive vehicles is very high. But the manufacturing rate of the company’s production facilities is very slow. That’s why the company’s delivery rate is dropping and it’s presenting a negative image of the company.
The innovative designs of Tesla require a lot of experimentation and new techniques. The delay in the production of Tesla’s vehicles still continues. For instance, the Model X of Tesla was so complicated mechanically. It created a lot of production issues, that’s why its distribution kept on delaying.
Below you can find the opportunities for Tesla Inc.
The stock market trusts growing companies with a proven record of increasing sales. Tesla Motors has proven it over the years. That’s why its share price in the stock market is increasing.
Tesla Pick-up Trucks
According to a report by the National Automobile Dealer Association, the pickup truck of Tesla has a growth potential of 17.6% in the US automotive market. It has potential, especially in the electric vehicle market.
Self Production of Batteries
Tesla has recently launched the project of manufacturing battery cells. It’s a huge initiative for the automotive company. It would help the brand to decrease the manufacturing cost and increase the production rate.
Tesla Motor was buying batteries from Panasonic previously.
Low Price Cars
The focus of Tesla Motors is to introduce some different/innovative products in the market. The innovative approach increases the engineering cost. Model 3 of Tesla has a low price than Model S with limited features, battering timing, and power. The company should follow a cost-effective approach to increase its market share.
Tesla Motors should change its focus on the Asian market. It’s an untouched market in the electric automotive industry. The expansion in the Asian market would help the electric automotive company to reach the global market. Additionally, it would provide the company with financial stability and market diversity.
Following are biggest threats to Tesla.
Many people perceived Elon Musk’s behavior as nonprofessional when he smoked marijuana in the live podcast of Joe Rogan. The share price of Tesla has decreased by 9% after the smoking event. Many people consider him a visionary person and he has proven it over the years. But some of his impulsive responses made the people question his leadership role.
Self-driving Cars Regulations
Many companies have started manufacturing self-driving cars. The legal status of self-driving vehicle technology is uncertain. Many countries including the US have not devised laws and regulations for self-driving car technology. The restriction and confusion about the legal status of self-driving cars would decrease Tesla’s sales.
As we know that Tesla’s battery packs comprise of lithium-ion cells. Lithium has a high tendency of being reactive and explosive. It increases the risk factors of Tesla’s vehicles. There are incidents where Tesla’s vehicles ignited the fire and emitted smoke. Many people questioned the company’s technology after such incidents.
Limited Supply of Material
Tesla’s major supplies are copper, nickel, cobalt, lithium, aluminum, lithium-ion, and steel. The availability and price of all these supplies are uncertain and volatile. The lack of basic supplies slows down the production process of electric vehicles, and it impacts sales.
Elderly people above 55 years old feel unsafe about self-driving cars. According to a survey by YouGov, the US elderly people don’t like the presence of self-driving cars around them.
The success of any business depends on the acceptance and adaptability of the customer market. If they don’t accept the product, then it would fail. Tesla has pioneered electric automotive vehicles. Now the brand should wait for the market to accept and adapt to the latest technology.
Tesla Motors has had some manufacturing issues and it has made people cautious about the company’s product. Such issues have decreased Tesla’s market reputation and sales. Even though the automotive company assures them about the sustainability of its product, but it takes time.
It’s no doubt that Tesla’s innovative vehicles attract the attention of the customers market. Complicated engineering resulted in the form of defective products. It’s negatively impacting the brand image of Tesla motors.
Many companies have jumped into the electric automotive and self-driving market in recent years. Tesla has to face prominent competitors like Ford, General Motors, Volvo, Toyota, Lexus, Audi, BMW, and Mercedes both in the electric automotive and economical vehicle industry.
These brands are offering fully electric sustainable vehicles at an economical price range. It’s the major threat that Tesla has to worry about. Tesla’s innovative and expensive are getting out of the range of customers’ purchasing power.
Tesla Motors offers a high-quality product by following the standardized production processes. Even then the automotive company faces the defective product liability claims lawsuit. Such lawsuits and claims are increasing the additional cost of the product.
Many Tesla users have filed a lawsuit against the company about the defective autopilot feature. It resulted in the form of accidents in some cases. These product liability claims and lawsuits are jeopardizing the company’s reputation along with increases the financial losses.
Tesla Motors should find a way to address these issues and provide optimum quality products.