Each student will be responsible for conducting a research project of a company based on the material we have covered in this course. You may choose a company that is publicly traded on an New York...

Tesla Inc.
    Tesla Inc.    9
INDEX:                                PAGE NO.
1. Company Selected                                 3
2. Industry Analysis                                3
3. Business Environment & Strategies                    4
4. Porter 5 Forces Model                            5
5. Dynamic Competitor Analysis                        6
6. PROBLEM 1 – PRODUCTION CAPACITY                 7
7. SYNTHESIS                                    8
8. STRATEGIC PLANNING                            9
9. STRATEGIC PLANNING                            14
10. STRATEGIC CONTROL & EVALUATION                16
References
Glossary & A
eviations: CBA: Commonwealth Bank of Australia
             ICAL: Indigenous Customer Assistance Line
             SWOT: Strength Weakness Opportunity Threat
             PESTEL: Political Economic Social Technology Environment & Legal
             M&A: Mergers & Acquisitions
             JVs: Joint Ventures
             EVs: Electric Vehicles
    
EXECUTIVE SUMMARY:
Where most of the competitors were proceeding in this huge profit oriented auto industry, the South African born Elon Musk having a Canadian mom had different plans. Sustainability was the first priority in the mind of Tesla aiming for renewable source of energy over this dominated nonrenewable energy market.
COMPANY SELECTED – TESLA MOTORS:
INTRODUCTION
· Founded in 2003 by engineers in Silicon Valley.
· Electric car with instant torque, incredible power, and zero emissions.
· Accelerate the world’s transition to sustainable transport.
INDUSTRY ANALYSIS:
· Adoption of electric vehicles slow
· Tesla Model S $70K+ and X $80K+
· Tesla Model 3 $35K+ in future.
· Demand for lithium-ion batteries.
· New $5B ‘Gigafactory’ will provide
Competitive advantage for Tesla.
· Low oil prices (WTI NYMEX $48-60)
· 1.2 million EV’s by end of 2015 (0.5% of total global vehicle sales)
· Global warming and climate change
· G7 goal to eliminate ca
on and greenhouse gas emissions by 2100
S
SOCIAL
T
TECHNOLOGICAL
E
ECONOMIC
E
ENVIRONMENTAL
P
POLITICAL
· Tax credits and incentives
· $7,500 income tax credit across US
· $8,500 rebate + carpool access in ON
· Emission regulations and penalties
· NADA prevents Tesla from selling
directly to consumers in some states
L
LEGAL
· Exporting US jobs and manufacturing
· Tesla sharing patents to encourage
development of electric vehicle market.
· Higher female employment (47.5% of US workforce in 2013)
· Smaller households (smaller cars)
E
ETHICAL
D
DEMOGRAPHIC
BUSINESS ENVIRONMENT & STRATEGIES:
ROLE OF STRATEGY IN AUTO SECTOR:
PORTER’S 5 FORCES MODEL:
Planning Stage:
UNDERSTANDING THE COMPETITIVE LANDSCAPE
5 FORCES MODEL – EV
UNDERSTANDING THE COMPETITIVE LANDSCAPE
DYNAMIC COMPETITOR ANALYSIS:
Business Environment
    Competitor Analysis (DETAILED):
    
    
    Competitors
    Main Concerns
    Room For Growth
    
1. Main competitor is Fiske
· Karma starts at $96,000
· Repeated troubles safety-wise
2. Chevy and Nissan both have Ev’s, but neither are sports cars
· Sales of both are down
    
· Lost money on the Roadster.
· Analysts limit value of EV market.
· Production capacity.
    · Stock is so low because Tesla lost $1.
· Billion on the Roadster.
· Most don’t know it was planned.
· Competitive price can allow for unlimited growth, especially in countries like China.
· EV market is constantly expanding, Tesla leads the market.
· With very few legitimate competitors.
· Tesla plans to release Model X (cheaper, mini-SUV) where they start making profits.
PROBLEM 1 – PRODUCTION CAPACITY:
PROBLEM ANALYSIS
KEY ISSUE
· Single assembly line causes significant delays and extremely long wait times for consumers
· Reliance on few suppliers can threaten production
· Unable to generate positive cash flow for the past 5 years
Tesla’s vehicle production capacity is low and depends on one manufacturing plant located in Fremont, CA
RECOMMENDATIONS:
STRATEGIC
ALLIANCE
Stable Strategic
Cooperative Network
REVISE
CORPORATE STRUCTURE
Synergistic
Alliance`s
COOPERATIVE
STRATEGY
SYNTHESIS:
STEERING TESLA IN THE RIGHT DIRECTION
Ultimately lead to improvements in Tesla’s performance and strategic direction
Strategic recommendations include Allainces and revised corporate structure
Tesla must address its production capacity and corporate leadership issues
What are the ways in which various Alliances can be classified?
     
     
    Tesla
    Tesla
    Tesla
    Tesla
    Tesla
     
    Type of Alliance
    Functional Level
    JV, Business Level
Pre Competitive
    Business Level
Pre Competitive
    Corporate Level
Non Competitive
    Corporate Level
Pro Competitive
     
    
     
    Tesla got access to Panasonic Supply chain, Agreement for R&D, Tech. Development
    Transfer of Technology or Joint Development of Technology for development of Heat sink in Batteries
    It was an equity partnership in which Daimler took 10% stake in Tesla
    It was an equity partnership of Tesla in the exchange of 3% stakes. Tesla acquired a manufacturing plant with the help of equity sold to Toyota
    Sotria
    Functional Level
    Exported car's fi
e bodies
    
    
    
    
    Panasonic
    JV, Business Level
    Panasonic find an opportunity with Tesla and in long term exchange of technology and expertise. Business opportunities and Brand development.
    
    
    
    Dana Holding Corporation
    Business Level
    R & D partnership for the development of technology to overcome the heat developed in car batteries. Technology to be used by both the companies.
    
    
    Daimle
    Business Level
    For Daimler it was a business level strategy as Tesla has to provide OEM, Battery packs and charger to Daimler.
    
    Toyota
    Business Level
    Tesla agreed to develop EV for Toyota and to develop electric powertrain. Toyota was looking forward to acquire the technology developed for the EV segment, after its failure in same.
Alliances:
Corporate Level Strategy
· Strategic alliances like synergistic alliances allow firms to grow and simplify their operations:
· Supplier alliances are crucial to entrepreneurs using new technologies, and they can take a variety of forms:
· Tesla served as the OEM supplied components i.e. battery packs and chargers for Daimler’s Smart for two, or “Smart car.”
· JV with Panasonic facilitates strategic access to Panasonic's supply chain and reduces risks.
· R&D agreement between Panasonic and Tesla Motors for developing next-generation automotive-grade battery cells helps Tesla to access new technologies and their variety.
· Tesla could combine new technology with its cu
ent EV battery expertise in order to create one of the most efficient EVs, the Tesla Model S (Tesla Motors, 2011).
Effective Alliances:
Corporate Level Strategy
Non-Equity:
Dedicated Manufacturing:
· A
angement with the French company Sotira, which manufactures the car’s ca
on fiber bodies
· Tesla Motors entered into alliance agreement with a Daimler affiliate, Freightliner.
Equity:
· Toyota acquired a 3% equity stake of Tesla Motors by investing $50 million
· Daimler invested $50 million in...