Contents

1. INTRODUCTION............................................................................................2
2. AUTOMOTIVE INDUSTRY AND TESLA MOTORS...............................3
2.1 History of the company ...............................................................................3
2.2 Tesla Motors ................................................................................................3
2.3 Evolution of Tesla ........................................................................................4
3. ANALYSIS TESLA MOTORS ......................................................................6
3.1 Business model .............................................................................................6
3.1.1 In the Beginning ........................................................................................6
3.1.2 The Next Stage ..........................................................................................6
4. TESLA AND COMPETITORS ....................................................................14
4.1 Competitors. ...............................................................................................14
4.2 How is Tesla going to compete? ...............................................................15
4.2.1 Innovative lithium ion batteries .....................................................16
4.2.2 Large network of supercharger stations........................................16
5. UNIQUE DIRECT-TO-CUSTOMER SELLING MODEL ......................17
6. DEVELOPMENT Ò LITHIUM CELLS “ GIGAFACTORY” ................17
7. CONCLUSION...............................................................................................18
REFERENCES.........................................................................................................19

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1. INTRODUCTION
Today, the level of environmental pollution has been a problem that many
developed countries have to deal with, not only that, human health in industrialized
countries is also going down. Transportation industry is one of the most toxic gas
emission industries. In particular, internal combustion engines are one of the core
causes of heavy pollution as today. The amount of NOx, SOx, CO2, COx ... is
extremely toxic not only to humans but also to the earth directly - our green house. In
that situation, special leaders in European countries have set milestones to completely
replace diesel-powered vehicles and including gasoline engines with electric motors.
In the US, nature lovers and careers are willing to order electric cars despite high
costs and many shortcomings. Pioneer in electric vehicle industry in the US is Tesla.
In the automobile industry, electric vehicles have been researched by manufacturers
for a long time, but the achievements are not much. Chevrolet Bolt, Hyundai Ioniq,
Nissan Leaf were the electric cars of the previous Tesla Model 3. However, these
models are not much interested. Although not the first electric car in the world, Tesla
Model 3 got an order beyond expectations. 276,000 units were sold after 3 days of
launch, bringing Tesla nearly 10 billion USD.
So why does an electric car come to life that makes people so crazy? It is even
considered by the world's users as the "apple of the automotive industry". It can be
explained by a fairly simple phrase, because Tesla is different from traditional cars.
Where did the difference come from?
To get an overview of the reasons for that remarkable difference, our group below is
the topic: "Researching Tesla electric vehicle overview."

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2. AUTOMOTIVE INDUSTRY AND TESLA MOTORS
2.1 History of the company
- Tesla is a name taken from an American inventor (Tesla Nikola), who was born
in 1856 in 1943. Tesla is known for his revolutionary contributions in the fields of
electricity and magnetism in the end of the century. 19 early 20th century.
- Founded as Tesla Motors, Tesla Inc. Founded in July 2003 by Martin Eberhard
and Marc Tarpenning. Both played an active role in the early development of the
company before and after Elon Musk's involvement.
- Elon Musk was a well-known investor, PayPal was sold and he earned 170
million USD. M usk is focusing on SpaceX aerospace project. The paperwork
was drafted and finalized on April 23, 2004. Musk spent 7.5 million USD and
became Chairman of Tesla Board
2.2 Tesla Motors
Tesla Motors was set up in the heart of Silicon Valley in Palo Alto, CA in 2003.
The firm was established with the commitment to develop only fully-electric
vehicles. Elon Musk, the billionaire CEO of the Tesla Motors, is one of the
primary driving factors behind its success. Tesla Motors unveiled the ultra-sporty
Tesla Roadster at the SF International Auto Show in Nov. 2006. While the model ’
s design was not unique, Tesla’s electric drivetrain technology was revolutionary.
It was the first vehicle to use lithium ion technology and was the first all-electric
vehicle to travel more than 200 miles on a single charge. Tesla proved that electric
engines can be extremely powerful and can provide acceleration well in excess of
their petrol powered rivals. The base price of the car in USA was around $109,000
targeting the premium segment. Sales volumes of electric and hybrid cars in the
USA was significantly hit by the economic downturn of 2008. However sales
picked up in 2012, when the country’s economy stabilized, governmental
regulations shifted in favour of high efficiency vehicles and gasoline prices rose.
The Model S sedan, launched in June 2012, is the current flagship vehicle for
Tesla. It comes with options of a 60 or 85 kW battery pack, allowing a mileage of
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208 to 265 miles. It is priced between $70,000 and $100,000 in the USA, again
targeting the premium segment
2.3 Evolution of Tesla
2006: (Tesla roadster) Tesla gained attention for the first time after the official
presentation of the first all-electric sports car Tesla Roadster in July 2006. The
car can travel 393 kilometers on a single charge while it takes three and a half
hours to fully charge the battery. It accelerates to 100 km/h in just 3.7 seconds.
The maximum speed is 201.1 km/h.
Tesla Roadster uses an AC motor (alternating current motor) revealed directly
from Tesla’s original design in 1882.
The cost of the basic model was $ 109,000. The company stopped the production
of Roadster in January 2012. During the period from 2008 to 2012 Tesla Motors
has sold more than 2400 Roadster cars in 31 countries. The release of a new
generation of Roadster was announced in 2015. It is planned to be released in
2019
2009: (Model S) Tesla’s Model S prototype was shown at a press conference on
26 March 2009. The sedan production started in 2012 and deliveries to customers
in June 2012. On a single charge of the 60 kWh battery capacity Model S can
travel 426 km, and with a battery capacity of 85 kWh, the distance will increase to
510 kilometers. In the most expensive configuration the car is able to accelerate to
100 km/h in 3.1 seconds. Prices on Model S start from $ 75,000.
2012: (Model X) Tesla Model X is a full-size crossover which was first shown in
February 2012.The car is available in two versions: 90D and P90D.
The 90D version uses the battery capacity of 90 kWh and accelerates to 96 km/h
in 4.8 seconds and is able to travel 410 kilometers on a single charge. The P90D
reaches 96 km/h in 3.8 seconds and with the optional Ludicrous Speed Upgrade
package it takes just 3.2 seconds to get to 96 km/h. The P90D version is faster than
Lamborghini Gallardo LP570–4 or McLaren MP4–12C. The maximum speed is

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limited by “electronics” (as in the Roadster) at around 250 km/h. On a single
charge the car can travel 500 kilometers.
2015: (Autopilot) In October 2015 the “autopilot” feature was added to the
updated firmware of Model S. It can be used in cars manufactured after October
2014 as they are equipped with additional sensors (a camera mounted in the top of
the windscreen, a forward radar in the lower front grille as well as ultrasonic sonar
sensors in the front and rear bumpers) which provide a 360 degree buffer zone
around the car.
2016: (Model 3) Model 3 was previously called Model E and in the original
business plan it was listed under the code name Tesla BlueStar. The current name
was announced on Twitter on 16 July 2014.
The car was be presented in 2016. The first deliveries of the car began in 2017 but,
according to Musk, the company will be able to satisfy the expected demand only
in 2020. The estimated cost in the US will be $ 35,000. The size of the Model 3
will be 20 % less than of Model S and a single charge will last for 320 kilometers.
2015: (Superchargers station) In order to use Tesla cars for long trips the
construction of a network of “Superchargers” stations of fast charge began in
2012. By the end of 2015 there were 528 stations operation worldwide and having
3000 separate charges.
Currently stations mostly use solar energy which is supplied by SolarCity. Later,
all station will switch to solar energy.
2015: (Powerwall) Besides vehicles Tesla Motors is engaged in the production of
lithium-ion batteries designed for the conservation of energy for domestic use as
well as for backup power.
Powerwall has two different models of 7 and 10 kWh capacities. The electricity
will be enough to power the house during the evening and it will be charged by
solar panels during the day. There is also a Powerpack model with a capacity of
100 kWh: it is designed for commercial use and can be infinitely scalable.

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 2019: (Model Y) Elon Musk unveiled Tesla's mid-size electric SUV, the Model Y,
Thursday night in Hawthorne, Calif.
The most-affordable Model Y will have a base price of $39,000 and a 230-mile
battery range, but customers will have to wait until at least 2021 to own one of the
five-seater SUVs. Tesla will first sell more expensive versions of the Model Y —
with prices starting from $47,000 to $60,000, and offering more battery range.
Those will ship starting in 2020, according to the company.There are additional
charges for Tesla's autopilot software, a third row of seats and colors other than
black. A panoramic glass roof comes standard.

3. ANALYSIS TESLA MOTORS

3.1 Business model
3.1.1 In the Beginning
Tesla took a unique approach to getting its first vehicle in the market. Instead of trying to
build a relatively affordable car that it could mass produce and market, it took the
opposite approach, focusing instead of creating a compelling car. So Tesla delivered to
the market the first high-performance electric luxury sport car, the Tesla Roadster. The
company sold approximately 2,500 Roadsters before ending production in January 2012
3.1.2 The Next Stage
Direct sales
Unlike other car manufacturers who sell through franchised dealerships, Tesla uses direct
sales. It has created an international network of company-owned showrooms and
galleries, mostly in prominent urban centers around the world
Service
Tesla has combined many sales centers with service centers. They believe that opening a
service center in a new area corresponds with increased customer demand. Customers can
charge or service their vehicles at the service centers or the Service Plus locations. Also,
in certain areas, Tesla employs what it calls Tesla Rangers – mobile technicians who can
service vehicles from your house. Sometimes, no onsite technician is required at all. The
Model S can wirelessly upload data so technicians can view and fix some problems
online without ever needing to physically touch the car.
Supercharger network
Tesla has created its own network of Supercharger stations, places where drivers can
fully charge their Tesla vehicles in about 30 minutes for free. The premise behind
building and owning these stations is to speed up the rate of adoption for electric cars.
Without the ability to charge on the go (similar to the concept of getting gasoline while

6
driving), electric cars face a huge obstacle to mass adoption. Tesla will continue adding
to the network of Supercharger stations in the United States, Europe, and Asia
3.2 Porter’s Five Forces

Opportunities for Tesla: (Pratap, 2018)

Expansion of sales to Asian countries
Development of fully autonomous driving capabilities and resulting “shared fleet”
Product expansion into new markets, such as public transport and trucking
Sustainable technology is the future of the world
Internal Analysis: The internal analysis will be primarily comprised of core
competencies, distinctive competencies, and competitive advantage. There will also be
an examination of the Leader/Situation Fit.
Core Competencies: (2017 Annual Report)
Powertrain engineering
Vehicle engineering o Innovative manufacturing o Energy storage
Computer aided design
Crash test simulation

Distinctive Competencies: (2017 Annual Report)

Self-driving capabilities
Battery life longevity in travel
Vehicle Control and Infotainment Software
Dual Motor Powertrain – allows for instantaneous motor response, controlled
performance, and traction control

3.3 Tesla Motors’s business strategy

Revenue Streams: (2018 Annual Report)

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 • Sales: $ 17.63 Billion
Automotive
• Leasing: $ 883.5 Million

Energy generation
• $ 1.65 Billion
and storage

Services and
• $ 1.39 Billion
other

Successful companies have a clearly defined strategy, supported with their unique
value proposition (Collis& Rukstad, 2008). The strategy of Tesla, as shared by
Elon Musk is “to enter at the high end of the market, where customers are prepared
to pay a premium, and then drive down market as fast as possible to higher unit
volume and lower prices with each successive model” (2006). The above
mentioned strategy statement is comprehensive as it clearly defines the company’s
objective, scope and means to accomplish the objective (Collis & Rukstad, 2008).
Although Tesla is not yet profitable, the company’s jump in revenue, increase in
gross profit margins and the predicted success of Model 3 (based on existing pre
orders), suggest that Tesla’s steady strategic approach has offered advantage. The
company’s actions are aligned with their mission and long term strategy. Tesla
understands that its value proposition lies in its proprietary disruptive technology.
Hence, to keep up the growth all free cash flow is plowed back into R&D to drive
down the costs and bring the follow on producs to market as fast as
possible. When someone buys the Tesla Roadster sports car, they are actually
helping pay for development of the low cost family car with competitive
innovative technology. Tesla’s technological innovation based blue ocean strategy
has potential but so far has been very expensive. They remain unprofitable, are still
losing money on each car and $5 billion investment in Giga factory has not gone
down well with all stakeholders. The company intends to tremendously bring down
production costs once the Giga-factory works in full capacity but that requires
patience. The current valuations supporting the $25 billion market capitalization ae
based on future expectations. Therefore, despite being the technological pioneer
and global leader in the electric vehicle industry, Tesla’s remains a speculative
stock. I personally think that the high end disruptive strategy of entering through
premium customer base, creating an aspirational brand and then targeting the mass
market segment by launching an affordable yet elegant product is a strong strategy.
However, I think a $5 billion investment in a Giga factory at this stage when the
company is not yet profitable is a risky step. Outsourcing and collaborations for
mass battery production would have been a safer approach. Currently Tesla is
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selling only through its own stores and services through its owned super charger
and battery swapping stations. With global expansion and volume sales strategy on
cards, it is important for them to look at franchising and partnership options for
sales and service. Tesla has a mammoth goal of achieving a considerable market
share before any new imitation or competition hits the market (Dyer & Bryce,
2014). Musk’s goal of creating and selling 500,000 cars in a year needs to be
realized and a lot rides on the Model 3 car. If Tesla cannot achieve its ambitious
goals it could still emerge as a successful niche player in the ‘performance green
motors’ industry without creating much competition / interest from the big players
like Toyota, GM or Ford. However, if its strategy and business model is a success,
then with considerable market share and lack of good imitation, Tesla could create
some real change in the automobile industry leaving the big sharks behind (Dyer
& Bryce, 2014
Tesla Motors’s technology strategy
3.4.1 Tesla’s Secret Weapon: Intense Focus On Batteries
Tesla motors’s incredible abilities
The truck can go up to 800km at maximum weight at highway speed, said the company’s
CEO Elon Musk, without specifying the size of the payload.
Musk said the Class 8 vehicle, the heaviest weight classification for trucks, takes 30
minutes to recharge the battery enough to go nearly 650km, and that Tesla would build a
global, solar-powered network of “megachargers”.
The company’s other unveiling was its new Roadster, a sports car with a removable glass
roof and an updated version of Tesla’s first production vehicle. It can seat four and travel
1,000km on a single charge, a new record for an electric vehicle, Musk said. It can go
from 0 to 100km/h in 1.9 seconds with a maximum speed of over 400km/h, which would
make it the fastest car in general production.
Battery’s advantages
“Tesla still uses commodity cylindrical cells, whereas other car manufacturers still use
prismatic (Chevy Bolt) and pouch (Nissan LEAF) cells,” Thomas writes. In fact, Tesla is
no longer using off-the-shelf “laptop batteries” – it has worked with partner Panasonic
to develop new cells optimized for its vehicles (JOINT VENTURE). However, it has
stuck with the strategy of assembling large numbers of small cylindrical cells into a pack.
The Chevy Bolt’s 60 kWh battery pack has 288 cells. The Nissan LEAF’s pack has 192.
Tesla’s packs require many more cells – a Model 3 with a 50 kWh battery pack has 2,976
cells, and a Model S or X with a 100 kWh pack requires a whopping 8,256. Obviously
the smaller cells are cheaper, but it stands to reason that it must be more difficult, and
hence costlier, to assemble them into a pack.

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Figure 1 The image compares the approximate size of popular plug-in
vehicles on Tesla vehicles and other models
Therein lies a mystery – Tesla is widely believed to have the lowest battery cost in the
industry. But how does it manage to assemble all those tiny cells into a pack
economically? As far as Thomas has been able to tell, no one outside the company
knows. Tesla protect their intellectual property by holding it as a trade secret.
Suppercharger station
Tesla Motors has 1,441 Supercharger Stations with 12,888 Superchargers to get faster
charging, no more power sharing. Specilally, the appearance of V3 supper charging. V3
is a completely new architecture for Supercharging. A new 1MW power cabinet with a
similar design to our utility-scale products supports peak rates of up to 250kW per car. At
this rate, a Model 3 Long Range operating at peak efficiency can recover up to 75 miles
of charge in 5 minutes and charge at rates of up to 1,000 miles per hour. Combined with
other improvements we’re announcing today, V3 Supercharging will ultimately cut the
amount of time customers spend charging by an average of 50%, as modeled on our fleet
data. Supercharger stations with V3’s new power electronics are designed to enable any
owner to charge at the full power their battery can take – no more splitting power with a
vehicle in the stall next to you. With these significant technical improvements, we
anticipate the typical charging time at a V3 Supercharger will drop to around 15 minutes.

10
Figure 2 Tesla’s supercharger station in California Figure 3 Tesla’s supercharger station in the world

3.4.2 Engine Block

Figure 4 Three-phase electric motor used on Tesla vehicles

Instead of using an internal combustion engine (Internal Combustion Engine), Tesla

equips its car with an electrically powered engine block. Electric motor has outstanding
advantages in control ability. Allows the use of advanced control methods to control
motors, thereby improving the kinetic quality of electric cars. Compared to the internal
combustion engine, the three-phase electric motor used on Tesla models has more
outstanding advantages in many aspects (performance, weight, engine stability, fuel
consumption). materials, emissions problems, ...). While the internal combustion engine
has many different physical parts, this makes it difficult and costly to carry out
maintenance and repair for the engine every time something goes wrong.

The mass of the internal combustion engine blocks an average of about 180 kg but the
electric motor is only approximately 31.8 kg. Friendly engine, low fuel consumption

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 Figure 5 The image compares the mass and energy of the electric motor and the internal combustion engine

The average fuel consumption cost of an electric motor used on Tesla is about
$0.03/mile less than an internal combustion engine that costs $0.1/mile.

Figure 6: The image compares fuel consumption costs between electric cars and fuel-powered vehicles

Although less fuel-efficient than internal combustion engines, it does not mean that the
performance of the electric engine will be reduced compared to an internal combustion
engine. The electric motor always gives relatively perfect performance at or above 90%
in all cycles while in the internal combustion engine only the highest possible range is
40% or 45% for those The most optimal engine. And only maximum performance is
achieved in a short range of rewinding machines. The maximum speed of the electric
motor equipped with Tesla can reach 18000 rpm, which is superior to the internal
combustion engine (only 2000- 4000 rpm).

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 Figure 7 Compare speed range between internal combustion engine and three-phase electric motor

3.4.3 Autopilot System

Autopilot is a computer system integrated into Tesla's cars, providing semi-automatic
capabilities for these models. When the system is activated, Tesla cars can adjust the
speed, change lanes and park themselves without the driver's assistance. Autopilot self-
drive system integrated in its cars can be driven on highways and in parking lots. At the
same time, every automaker's car has been integrated with the necessary hardware and
will be activated when the software as well as the law allows. Tesla introduced Autopilot
in 2015, which will bring self-driving capabilities to its cars in certain situations. Tesla
continued to upgrade new hardware on all Tesla cars to support the new version of this
autopilot system, now called the new name Enhanced Autopilot.

Figure 8 Auto drive mode control panel used on Tesla cars

The impressive features that Tesla's Autopilot system can perform at the present time,
and features that may appear in the future:
- Tesla cars manufactured from October 2016 onwards are equipped with 8 cameras with
360-degree coverage around the car. Each camera has a vision of up to 250m.
- Besides, Tesla also integrates 12 ultrasonic sensors to identify and avoid hard and soft
objects.
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- Tesla cars have a radar system that looks through fog, heavy rain, dust and even a car
running ahead
-All new Tesla cars have Enhanced Autopilot compatible hardware. When the vehicle
runs on the highway, Enhanced Autopilot will be able to control vehicle speed based on
surrounding traffic conditions, determine whether to keep or change lanes, move between
highways and find a way out of the highway.
- This self-driving system can also handle curves, redirects or roads with many other
complex shapes. - But at the present time, Tesla cars are still not fully automated, and
Autopilot still needs to make sure that the driver is placing his hand on the steering
wheel. If the system detects the driver leaving the steering wheel for too long, it will
automatically pull the driver back and park the car before activating the system again.
- After leaving the highway, the vehicle will automatically transfer control to the driver.
However, once it arrives, the vehicle will automatically determine the available parking
spots and drive the vehicle to a parking position in a parallel or perpendicular manner.
- You can call the car out or into the garage without having to sit in the car
4. TESLA AND COMPETITORS
4.1 Competitors.
Tesla will continue to experience direct competition from other BEV entrants, indirect
competition from existing and emerging plug-in hybrid vehicle manufacturers and
competition from BEV ‘substitutes’ including gasoline hybrid and gasoline powered
vehicles. Tesla will begin seeing plenty of competition in the months and years to come.
Major competitors for Tesla include traditional auto companies such as:
General Motors (GM):
Chevrolet was the first to copy the Tesla formula with its 2017 Bolt EV getting 238 miles
per charge. During a media event at the North American International Auto Show earlier
this month, parent GM announced Cadillac will be next to go long-range for 2021, using
a platform that could eventually be used by dozens of other models.
Nissan
Nissan unveiled a 226-mile version of the Leaf at the Consumer Electronics Show in Las
Vegas this month. It could appeal to buyers who’ve been waiting for the long-promised
$35,000 base Tesla Model 3 – the current starting price $44,000; Meanwhile, Nissan will
offer eight all-electric models by 2022, with its high-line Infiniti brand switching entirely
to either plug-ins or BEVs.
Jaguar
Most upscale European marques are getting into the all-electric game. Jaguar recently
launched the I-Pace SUV with Audi soon to follow with the all-electric e-tron utility
vehicle and more to follow. Its sibling Porsche brand will start marketing its Taycan
electric sports car later this year.
BMW
BMW has offered a low-range all-electric, the i3, since 2013, along with the plug-in
hybrid i8 sports car. The Bavarian automaker is now developing a wide range of battery-
electric options for virtually every vehicle in its lineup.
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Mercedes, VW
Mercedes-Benz and Volkswagen both plan to start marketing long-range BEVs in 2019,
and both plan to create unique electric sub-brands, Mercedes-EQ and Volkswagen I.D.
The latter will include the I.D. Buzz, a battery-electric revival of the marque’s classic
Microbus.

Figure 9 Market share of car companies in America in 2018

What they all have in common is a desire to grab both Tesla’s market. At its Jan. 18
opening price of $325 per share, investors are still paying over three times sales for Tesla
shares, while they can have General Motors for less than one-third sales.
The market cap of Tesla — about $58 billion after a 6.5% overnight drop — remains $4
billion ahead of GM, $25 billion ahead of Ford Motor, and is more than double that
of Fiat Chrysler (FCAU), all of whom dwarf it in sales, profits, and numbers of
employees.

4.2 How is Tesla going to compete?

Tesla Motors’ source of competitive advantage comes from its ability to use an existing
technology in a more efficient way. They have differentiated themselves from their
competitors in the automotive industry by revolutionizing the lithium ion batteries to hold
more charge and in effect, provide better mileage compared to conventional hybrid or
plug-in based electric vehicles. The performance figures generated by Tesla’s batteries is
unmatched in the automotive industry. Besides the batteries, Tesla has developed a robust

15
and unique value chain ecosystem around its cars which provides better value and end-
user experience to customers.
Tesla’s competitive advantages include:
4.2.1 Innovative lithium ion batteries
While competitors discussed the long-term viability of the lithium ion battery and
debated onits feasibility, Tesla Motors launched their cars with it and entered a
market where there werefew competitors. Hybrid cars were in production before their
entry but Tesla was the first tointroduce cars reliant fully on battery power. To gain a lead
over competitors, Tesla madehighly efficient battery pack to give cars a better mileage.
By compacting thousands of highlyefficient Lithium-ion cells into a liquid-cooled battery
pack Tesla created highest energy densitybatteries in the industry.Despite the highly
compactstructure and weight (450kg), the battery pack is tuned to provide reliability,
efficiency and safety. Competitors can imitate this technology but Tesla has a significant
first mover advantage. A new model development for an established automaker can take
anywhere from 1 year (e.g. Toyota) to a decade (Mercedes & BMW) besides having
significant fixed costs investment.
4.2.2 Large network of supercharger stations
Tesla’s electric vehicles require long charging durations for the batteries. A full charge of
a Tesla car from home plug takes around 12 hours but 40 minutes from a Supercharger
station. Still it is comparatively long to conventional fuel based vehicles. So Tesla Motors
has offered the option of switching batteries at the Supercharger station with a fully
charged one. Moreover, for the premium car model owners, this service will be fully free.
This significantly reduced the cost of vehicle ownership and gives them a competitive
edge over rival electric, hybrid or gasoline-based car makers. The only downside is the
low number of these stations in the US. Currently at 37 this doesn’t pose much problem
for existing owners but with increasing in EVs on the road, this might become an issue.
Tesla plans to increase the number of its service stations by 75% and Supercharger
stations by 200 globally this year

16
 Figure 9 Distribute Tesla's charging stations around the world

5. UNIQUE DIRECT-TO-CUSTOMER SELLING MODEL

Tesla has played a differentiation game by focusing on providing a unique
consumerexperience by selling directly to the end users without the middle man route of
dealership.Customers get to customize their car before purchasing online. Tesla runs over
50 stores worldwide and because of full control over its operations, gets to maintain the
same level ofcustomer service at these locations.
6. DEVELOPMENT Ò LITHIUM CELLS “ GIGAFACTORY”
Tesla’s mission is to accelerate the world’s transition to sustainable energy through
increasingly affordable electric vehicles and energy products. To ramp production to
500,000 cars per year, Tesla alone will require today’s entire worldwide supply of
lithium-ion batteries. The Tesla Gigafactory was born out of necessity and will supply
enough batteries to support Tesla’s projected vehicle demand. Today, the Gigafactory
produces Model 3 electric motors and battery packs, in addition to Tesla’s energy storage
products, Powerwall and Powerpack.
The recommendation for the firm’s future technology strategy
The main strategy recommendation that Tesla should focus on is improving its
manufacturing efficiency. The company wants to expand into new foreign markets as

17
well as add semis and public transport vehicles to its product lines. But, these expansions
will be ineffective in generating revenues if its current factory system cannot maintain
production efficiency. In addition, Tesla should work to diversify its supply chain as
many of its current suppliers are single-source, therefore creating a strong supplier power
and potential for future delays. Finally, with its current high rate of cash spending, Tesla
will need to either find ways to cut costs or expand its financing and investing activities.
7. CONCLUSION
Tesla has shown that a Silicon Valley startup can enter one of the most established
industries of all. Even though incumbent firms and their market shares are large, this new
entrant is changing market structure and the value of existing firms. Rather than looking
at the market and assuming that matters will always be that way, Musk saw an unmet
need and used innovation to fulfill it. Starting with a minimum viable product, partnering
with other firms, recycling capital, and subsidizing aspects of the electric vehicle
network, Tesla has altered the landscape of the auto industry.
Tesla Motors is continually expanding its consumer demand globally. With markets
being expanded in Europe, the United States, and now with an increased focus on China,
Tesla Motors’ vehicles are going to be in high demand for a long time to come.
Currently, Audi, BMW, Mercedes, and Porsche have plans to compete in the electric car
market. Even if they are more successful or take over the market, Tesla will have helped
pave the way for a new technology in much the same way that now-defunct or purchased
firms such as RCA, Zenith, Magnavox, Kodak, Polaroid, Commodore, Amiga, and Atari
helped paved the way for modern stereos, television, photography, computers, and home
entertainment. The entrepreneurial process constantly encourages firms to come up with
better products and, in the process, disrupt existing market structures for the ultimate
benefit of consumers.

18
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tesla-1?fbclid=IwAR17Ppfa8zKC0B7YQ3Vg8xYl3wtwmKn-
7m_9begUz_Fv14748FwxBgOIFlc
Research project overview of tesla tram, student group Nguyen Quoc Bao, course K15,
automotive engineering industry, technical pedagogical university of Ho Chi Minh city

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