Strategic Management: Tesla’s Entry into The U.s. Auto Industry

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6000 words

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6000 words

Downloads: 51

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Table of contents

  1. Introduction
  2. Overview of the organisation
  3. SWOT analysis
  4. Strength
  5. VRIO analysis
  6. Valuable
  7. PESTLE analysis
  8. Political
  9. Porter's 5 Forces analysis
  10. Competitive rivalry (High)
    Bargaining power of the consumers (Medium)
    Bargaining power of suppliers (Medium)
    The threat of substitutes (medium)
    The threat of new entrants (Low)
  11. Integration of external and internal context of the organisation
  12. Major issues
  13. Current strategies
  14. Superior Technology
    Supercharger Network
    Sales strategy
  15. Recommended strategies
  16. Conclusion


The US has one of the biggest car markets on the planet. In 2018, U.S. light car deals arrived at 17.2 million pieces, the fourth consecutive year where deals came to or outperformed 17 million pieces. Generally, the US is the world's second-biggest market for vehicle deals and creation. In 2018, the US sent out 1.8 million innovative light cars and 131,200 medium and weighty trucks (estimated at more than $60 billion) to more than 200 business sectors throughout the planet, with extra fares of car parts estimated at $88.5 billion. With an open speculation strategy, an enormous purchaser market, an exceptionally talented labour force, accessible foundation, and nearby and state government motivations, the US is the chief market for the 21st-century car industry.

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In mid-2018, the U.S. car business was in the beginning phases of what many accepted would be a critical advancement in how individuals thought about and utilized vehicles. The upcoming would be overwhelmed by electronic and independent vehicles. Vehicle proprietorship in which individuals paid for a solid resource with every one of its fancy odds and ends would offer an approach to individuals purchasing miles on shared vehicles. Tesla fellow benefactor and President Elon Musk had imagined his organization's electric vehicles driving the car in the business' advancement. Be that as it may, the organization was consuming money at an impractical rate as it arranged to dispatch the business' first mass-market electric car, the Model 3. Numerous industry spectators questioned whether Tesla would have sufficient cash to remain above water and if Musk was the correct pioneer. After a progression of innovative victories, Elon Musk put and played a position of authority in Tesla Motors, an organization committed to commercializing the completely electronic car for the building marketplace. Tesla's flow item, the Tesla Roadster, is viewed as the main completely electronic car equipped for supplanting a fuel controlled auto because of its superior and adequate reach.

The report plans to focus on the outline of the Tesla Engines and how it entered the market of the USA. It intends to lead the SWOT examination to distinguish the Strength, Shortcoming, openings and dangers that the organization faces (Sun, 2019). It additionally endeavours to direct the VRIO examination to recognize the Important, Imitable, Uncommon and association procedure followed by Tesla on the lookout. It additionally centres around directing the PESTEL investigation of the firm to distinguish the Political, Monetary, Social, Mechanical, Natural and Legitimate powers affecting the firm in the market of the USA. It additionally leads Porter's five forces examination to recognize the dangers of providers, buyers, contenders and the dangers of new entering organizations. By focusing on this investigation, it gives a concise portrayal of the significant issues that are looked at by the organization and suggest techniques for the impending future so the firm can keep up its upper hand.

Overview of the organisation

In the market US, the worth of exclusive passenger car was $270 billion in 2016 at the level of retail. In 2008, the industry saw a downturn. Millennials flocked concerning dealerships. Tesla in 2003 was founded by some engineers. They wanted to prove that people won't have to compromise in order to drive in a better way. Tesla consists of 9 board members who have a close tie with Elon Musk. In 2018, several managers have departed. In the whole world, Tesla has 34,000 workers. There are also another 1000 workers who work in motor and battery Gigafactory based in Nevada. 10,000 employees work in the manufacturing plan of Tesla located in California. In 2010 Tesla went public. At that time the price was $17 based on per share. The stock traded at the share of $335 by 2018, August. Tesla’s capitalisation of the market was higher. In March 2013 Tesla acknowledged its first quarter of profit. In 2016 also it recorded the second quarter of profit. Tesla’s investors were keen on its visibility in the long term. Tesla builds up electrical vehicles and scalable storage products and clear generation of energy. Three automakers of the US accounted for 46% market share of the industry by 46%. It included the market share of Ford, General Motors and Chrysler. In the US 3 million people were employed in the sector of automation. Brand loyalty is expected from customers in the case of effective cars. The mission of Tesla is to accelerate the transition of the world to sustain energy. According to Tesla, people need to depend on zero-emission rather than fossil fuel. It must be carried away for a better future. There are various models of Tesla-like Model X, Model 3 and Model S.

The product line has been expanded for satisfying a maximum number of customers. Tesla focusing on the niche market made an entry into the industry of car. In the beginning, Tesla had to deal with quality default and technology glitches. Tesla won the “Motor Trend’s Car” award for Model S. Huge sets of components were produced by Tesla rather than sourcing this to suppliers. Model 3 is regarded as the lowest priced product and has a range of 310 miles battery. There are various competitors of Tesla-like Nissan Leaf and Chevy Bolt. At present, Jaguar -I -Pace and BMW i3 are its major competitors. Tesla made itself the cables, power electronics and battery. It has been predicted that 605 exclusive vehicles can be sold out in the US by 2025. More investment was done in mobility service and EVs by the new entrants. It has been projected that profit and revenue can be shifted due to service of mobility. Model X of Tesla is considered to be the quickest and safest vehicle. In a program of multi-day employees of Tesla take part. This is done to ensure safety and training for the workers. It is done to make quick improvement within the organisation. Across US Tesla consists of 76 centres of services.

SWOT analysis


  • Brand loyalty
  • Huge product range
  • Innovative

Tesla has numerous strengths which have made it earn maximum revenue. One of its strength is its brand loyalty. As it considers the niche market customer satisfaction is of high level. The product range of Tesla is also huge which has increased brand loyalty. The Roadster was the first car of Tesla. Model S, Model X and Model 3 are some of its product range. This has made Tesla match the sales of the BMW 7 and 6 series. An attempt has been made to sell Model 3 as mass production. It is considered to be one of the renowned innovative company. In 2016, Elon Musk unveiled the development of a vehicle. It is a vehicle of self-driving. The line of production is tested before an introduction of a car. The production of seats is outsourced for satisfying customers. Customers expect to get more techno-friendly and profitable products from Tesla. All these aspects have enhanced the brand name of the organisation.


  • Battery shortages
  • Complication in manufacturing

Tesla has to deal with two major weakness. One is shortages of batteries and the other is manufacturing complications. In the beginning, there were some technical glitches for which manufacturing created problems. The production delays have stopped making Roadster. It became difficult to manage the suppliers(Ajitha, and Nagra, 2021). While launching Model X as well there has been an issue in manufacturing. Supplying batteries have become limited. It has decreased Tesla’s rate of production. The lobby of dealerships has hampered the expansion of the concerned company. Issues concerning components quality have also been acknowledged. There is a need for a lot of improvement in order to maintain its position in the competitive market.


  • Expansion of sales
  • Low prices car models

Based on Tesla’s website, it owns 111 stores. The stores are in 26 different states. The company is working hard to expand in terms of worldwide. In 2019, Tesla operated in 11,000 superchargers and 1300 charging stations. Across the US Tesla has 76 centres of services. Through this more market share is gained by Tesla. It has a positive future growth. The company has aimed to build cars of less price. Focusing on zero-emission has also increased its sales growth. Though Tesla's stores Tesla, the cars have been sold instead of relying on other dealers.


  • Competitive market
  • Adaptation from customers

Tesla is also dealing with threats that need adequate improvements. There is stiff competition. Ford, General Motors have also been the competitors of Tesla. At present, Jaguar I-3 Pace is one of the leading competitors. Other brands are also providing cars at low prices which is a threat to Tesla. The success of a company depends upon adapting the nature of the customers(Khan et al., 2021) Tesla relies upon the willingness of consumers as the same service is provided by other companies

VRIO analysis


Value is established in the case of Tesla. All the resources of finance in Tesla are valuable. Its brand image is an influential source of advantage of competitiveness. Through innovation, by making eco-friendly cars and considering Zero-emission it has established its position. The batteries are prepared within the organisation. The cars are sold through their stores and are not dependent on outside dealers. Employees of Tesla are also exclusively valuable. There are roughly 34,000 employees. Apart from this, there are more than 1000 workers who work in battery and motors Gigafactory. Development and research for enhancing customer expectation are also valuable. Self-driving cars have been planned by Musk which has added to the value of innovation. Employees maintaining a good relation with customers improves the brand loyalty of Tesla. Tesla is valuable because the experience of consumers can be controlled. In this case, the competitive advantage is permanent.


Employees and financial resources are considered to be rare with respect to Tesla. The workers over here are trained immensely. Training programs are given to make the workers more skilful. Through this better quality of service is delivered by the concerned company. The financial resources are not carried out by most of the other companies. Tesla is the only company that does not depend upon outside dealers. It sells the product from the store itself and does not rely upon independent parties. Expansion of brand is not rare. Other brands are also targeting the niche market to gain maximum revenue. In order to enhance the brand value, it is done by other car industries. Global presence is rare because Tesla has a significant market position. It is mostly preferred by customers as environment and technical friendly products and services are put forward.


The strategies of pricing are easily immutable. Tesla manufacturers low proceed model. It is also done by its competitors for attracting customers. Brand loyalty and global presence are immutable. The competitors by using similar market plans can improve their brand loyalty(Vargas-Hernández and Garcia, 2019). This can make them expand on a global basis. Employees are also immutable. The competitors can also retain the workers and keep effective training. Over here the competitive advantage is temporary. In terms of product range, other car industries are also working on design and efficiency. It is found to be compatible resulting in a less positive outcome for Tesla.


Tesla is one of the leading organized company in the auto industry. Tesla focuses on educating customers. This is done to make the consumers aware of its different product range and way of working. The position of the market with respect to Tesla is superior. Due to the high innovation performance of Tesla has strengthened. Both employees and financial resources of Tesla are organized. This makes the company deliver better quality of product and service. 85,000 of the 3s Model had been manufactured by Tesla. All the works are organized to earn a greater profit.

PESTLE analysis

Tesla’s decision to enter the market of automobiles in the U.S. has been marked by various factors. It is important to understand the external business environment of the concerned market for Tesla to understand the opportunities and the threats that face the company (Liu and Meng, 2017).


Factors - This will identify the impact of the government on the business of Tesla and the macro-environmental factors that are associated with the same.

Impact - The U.S. government has shown a keen interest in the development of electric vehicles. Apart from that it also experiences political stability at the moment and has new and fruitful global trade agreements. The political environment favours Tesla’s entrance into the automobile market.


Factors-  This will determine the ways in which the economy can affect a business of a nation. Market growth, currencies and trade levels are some of its measurement bars.

Impact - The cost of the electric vehicle battery has been decreasing with the increase in the number of users. Renewable energy resources are also not incurring much cost. However economic stability is nought to be had and this might be a threat for Tesla.


Factors - These will determine how the trends of a particular society, as well as consumer behaviour, can determine the external business environment factors for a company.

Impact - The case study used in the referral for this report points to the current business situation and market of the U.S. which clearly shows a want of electric vehicles and also, autonomous driving, connectivity and the like. These have opened up the opportunity for Tesla to establish a stable place in the automotive market as they are capable of catering to consumer demands (Dibble, 2018). Apart from that wealth distribution has been improving in the developing markets which are also an opportunity for Tesla.


Factors - These will determine how technology innovation has affected businesses in a nation. In the automotive industry, it is especially noticeable.

Impact - electrification of vehicles and also demands of connectivity in the U.S. has been rising in the last couple of years and the only deliverer was Nissan with its LEAF models. Tesla has an opportunity for innovation and entrance into the market by bringing its own EVs taking advantage of technological development. However, they also have to keep up with the constant changes in technology in order to stay ahead in the market.


Factors - These will determine how the environment has an impact on global business. These include global warming, climate change and organizational responsibility to take sustainable steps.

Impact - Tesla has the opportunity to promote its electric vehicles in order to meet the climate change and carbon footprint issues (Schmid, 2017).


Factors - These will determine how certain regulations and rules about trade and businesses in a country affect its businesses.

Impact - the patent protection laws internationally has expanded and so has regulations on energy consumption. Both are opportunities for Tesla while the sales regulations in the States can be a threatening issue to the company.

Porter's 5 Forces analysis

The strategic steps of Tesla can be improved by analyzing factors that pertain to the external competitive environment of the company in the U.S. Porter’s 5 forces analysis will aim at the examination of the factors that can affect Tesla upon its entrance into the U.S. market.

Competitive rivalry (High)

Even though the automotive market in the U.S. does not have many players, the existing firms are aggressive enough to compete for their respective place in the market. As per the study used in the referral of this report, the Nissan LEAF was the only competitor in the market for Tesla and their electric vehicles can enter the market successfully all things considered (Kim, 2020). However, the competing companies, even few, are particular in the field of innovation and promotion and an additional threat is a low impediment or switching cost.

Bargaining power of the consumers (Medium)

Consumers are important for any company but the automotive industry is not entirely dependent on the consumers’ bargaining power. Therefore the threat is relatively moderate. The switching costs have been identified to be low and therefore the barriers to making purchases from other companies are low- this is a threat. However, the availability of substitutes is moderate which does not leave the consumer with many options.

Bargaining power of suppliers (Medium)

The forward integration, supply level and sizes of the suppliers are all moderately threatening in terms of the bargaining power of the suppliers on Tesla. The size of the suppliers is medium and hence they do not have much impact on the automotive industry at large (Sull, and Reavis, 2019). The bargaining power of the suppliers does not have to be the primary concern of the company in their strategic management systems. The suppliers oftentimes use third parties to make the supply deals with Tesla which reaffirms their position as not that threatening for the company’s businesses.

The threat of substitutes (medium)

There are not many companies that can be threatening to the company at the moment and Tesla does not find many companies that can substitute its products. The competitive factor in the automotive market in Tesla arises because the switching costs are low. The substitutes that do exist in the market are very few and usually do not perform well enough for the consumers to be drawn away from the products made by Tesla. Therefore this threat is relatively medium.

The threat of new entrants (Low)

Upon studying the competitive market that Tesla is to operate in the U.S. it has been understood that in the automotive industry the threat of new entrants is relatively low. There are a few factors that work behind it such as, the costs behind the development of the brand, business development, as well as the economies of scale being high, all of which work against the prospects of new entrants into the market. The economies of scale benefit established companies like Tesla and it is tough for any new entrant to beat them.

Integration of external and internal context of the organisation

In order to truly assess the state of the market in which Tesla has entered it is important to study the internal environment of the company in relation to and integration with the external environment. The external environment comprises political, economic, social, technological, environmental and legal factors and the internal environment is understood by studying the company’s own existing strengths, weaknesses, opportunities and threats.

Tesla is an established company and therefore many consumers are loyal to their brand. They also have a wide range of products and services and have earned many profits by constantly reinventing and innovating their products. In 2018 Tesla had only 0.2% market share which was relatively low as compared with the likes of Ford and Toyota. Some of their weaknesses have been in terms of their electric vehicles and the chief issue has been the shortage of battery power. The manufacturing system itself has also been identified to be slightly complicated especially in terms of the electric vehicles that are very much in vogue in the U.S. and are one of the chief products of Tesla (Thomas and Maine, 2019). However, the low switching price has made the market very competitive for the company apart from the issue of consumer behaviour as well as adaptability.

Tesla can maximize the opportunities that are presented to the company in terms of sales and the prices of their manufactured vehicles. The political factors reveal an environment where the government investment in the making of Electric vehicles has increased. About 5% of the revenue has been invested in the research and development of electric vehicles. The government has also made trade agreements globally which can help Tesla even more in the sales of their cars.

Economically the threat of instability can increase the pricing issue with Tesla. Tesla has a strong supplier base where more than 11,000 companies have identified as automotive suppliers. The fact that Tesla’s cars are priced expensively which hinders the strategy of competitive pricing will not be improved anyhow. The automotive supply business is standing at $2.2 trillion at the current stage. However, the costs of battery, as well as renewable energy, are significantly low currently and that can assist Tesla in changing the pricing structure of its products.

The threat of consumer adaptability has been found out as an internal issue but externally analyzing it can be said that consumer behaviour is changing rapidly. The social factors point to the fact that consumers are more and more interested in low-carbon lifestyles and hence want to opt for more sustainable processes. This can open up several avenues for Tesla in terms of consumer adaptability and change the course of the issue from that of a threat to an opportunity.

Technologically the rate at which it is advancing and changing it can both be a threat and an opportunity for Tesla. Considering the internal factors Tesla does not seem to have an issue in investing in innovative aspects and reinventing the models that they manufacture and send forth in the market. If Tesla can continue on the path of innovation this might not be a threat at all.

The environmental factors have only contributed to the opportunities that Tesla already has in the market. The company seeks expansion globally and therefore it can make use of the environmental factors and promote its electric vehicles in the market so that the consumers can avail of more sustainable options.

The legal factors can only be threatening in the case of Tesla if the sales regulations in the U.S. do not fit their requirements. In all other cases, the patent protection and the energy consumptions norms can contribute to the opportunity of building less pricey cars for Tesla.

Major issues

Some of the issues faced by Tesla Motors are as follows:

  1. Under capacity generation: The fabricating office at Fremont as well as the Gigafactory have not been capable to function at their complete volume. Car corporations in such a circumstance shifted to convention fabricating which Tesla has fizzled to do.
  2. Costly Autopilot component: The autopilot framework created by Tesla makes use of photographic cameras and processors instead of fetched viable mapping advances and laser locators utilized by General Motors and this has come about in elevated budgets. Carmakers like Cadillac and General Motors have effectively bowled out their possess hands-free innovation stimulating Tesla’s modest benefit.
  3. Liquidity Crunch: despite having a solid advert capitalization, Tesla aspects the issue of money and presently blisters about a billion each quarter. Tesla isn't talented to create on a huge scale due to blockages confronted in Gigafactory that has however not been able to realize full working volume.
  4. Failure to capture mass markets: Tesla has fizzled to arrest the frame showcase in rapports of deals electric cars on the justification of big costs are negligible contributory to a small 1 per cent in add up to worldwide deals. This denies it from frugality of scale profits.
  5. Inadequate charging foundation: The boosting postings created by Tesla can be measured to be profoundly lacking in the event that the arranged generation and deals are considered. Tesla is wedged with the overwhelming errand of at the same time creating a charging organization at the side generation of cars.
  6. Legal fights: The legitimate fights over true to specifically offering its electric cars is another contest confronted by Tesla engines because it includes gigantic expenditures.
  7. Item dispatch delays: Tesla has regularly confronted the issue of postponements in satisfying conveyances to the clients and at periods the dispatch of unused cars has been essentially deferred. Moreover, Tesla took aspects related to security discernments of clients concerning the utilization of electric cars. There are worries about the lifetime of the battery and the accessibility of the charging foundation.
  8. One man shows: Tesla right now is respected as one man appears tracked by Musk Elon who needs to regulate the whole thing at Tesla other than consecutively other wanders like Space and Sun based city. This needs to a few degrees influenced Tesla as the administration competencies of other skilled individuals has not been utilized efficiently.
  9. Trouble finding mechanics: Even though electric vehicles need less support and less maintenance, it is still imperative to discover a capable workman in the range. Tragically, 97% of repairpersons are not competent to make an effort on electric cars. Of the 3%, that’s, numerous of them work for authorizations. Even though there is a part of crossbreed cars on the street, they need upkeep administrations comparative to commonplace gas-powered cars. This implies that knowledgeable individuals employed on crossbreed cars are not essentially learned approximately all-electric replicas. Shockingly, electric car proprietors have fewer alternatives for competent mechanics hence making it less requesting within the advertisement of the US.

Current strategies

Martin Eberhard and Marc Tarpenning who are engineering entrepreneurs founded the famous and well-known company Tesla in 2003. The company first experienced cost overruns by producing Roadster which was the first electric vehicle. The company’s differentiation strategy is to play a long term by focusing on battery technology, electric automobile automation and environmentally friendly services and products but in case of taking entry into the US Auto industry they have different strategies. Tesla’s master plan is to take entry at the high end of the US auto industry market in which customers are ready to pay a premium but then through driving down the market they will make lower prices in each of their models (Teece, 2018).

Tesla’s first attempt was the Model 3 which was aimed to produce in front of mass in the US auto industry. They had multiple strategies before producing the model in the competitive market. Even though their current strategies are also similar to those past strategies and small improvisations have been done to become successful in the US auto industry shortly. Their current strategies are as follows.

Superior Technology

Tesla has planned to make their electric vehicles superior compared to other competitors. Their strategy is to make the motors equipped with the help of proprietary magnets that will make them efficient and cheaper. Their target was to focus on niche markets to get an entry into the car industry. Their first model named Model 3 was the lowest-priced model and even recent models are also available at the same having a range of 310 miles (Sull and Reavis, 2019). This strategy is resulting in more profit in their business.

The company’s energy storage system is made up of individual lithium-ion batteries and they are installed in the bottom of the car so that they can be handled easily (Offer, et al., 2020). Model 3 indeed had 14% better energy density compared to others. The company has planned to manufacture the batteries and motors in their own Gigafactory and started with their first model known as Model 3. Therefore the time needed for manufacturing batteries had reduced from seven hours to 17 minutes.

Supercharger Network

There is a said fear that long-distance driving is not possible with electric vehicles. Tesla has broken down this misconception by implementing the strategy of developing supercharger networks which are supercharging stations and these stations offer fast charge like 50% in about 20 minutes (Thomas and Maine, 2019). Though, other EVs cannot access Tesla’s supercharger network.

Sales strategy

Tesla is not only concerned about producing models but also aims to sell them successfully. So, the company does not depend on the dealers to sell their products as other companies follow. They have their stores where they have appointed salespeople to sell their cars and Tesla has their own 111 stores in around 26 states in Washington D.C. This strategy is said to be the most effective strategy as the company receives more responses by selling their cars through their stores in the United States.

Recommended strategies

Tesla by centring on centre proficiencies and at a similar period ought to study working adequacy which will offer assistance to represent receptiveness to outside as well as the inner atmosphere (Musonera and Cagle, 2019). With appealing replicas engaging to showcase Tesla ought to quicken its move in the centre which is likely to surrender superior outcomes.

Tesla would to sordid its technique on modest elements as well as seeing that other car company with solid money related assets can move to electric cars in a brief span of period. Rising natural fares, expanding government back for maintainable conveyance, increasing oil charges and expanding move to electric cars show that electric cars are aiming to be the long term vehicle business (Dana, 2018). Tesla has to centre on distinctive markets of the USA and by arranging its fabricating area completely in different regions it ought to centre on taking a low-price administration technique in such marketplaces in order to offer to the mass marketplace.

Tesla ought to centre emphatically on the generation of model 3 which grasps crucial to victory and by engaging to the mass showcase it'll offer assistance it marked clients within the USA making a difference to attain thrifts of scale. The prevailing commercial model of offering straightforwardly to the clients has to be adjusted because it is an obstacle in trade development and has too included a few claims recorded in contradiction of Tesla. Tesla would have to be a fashion organization and jointly wander in to fuel its development.

Tesla has abstained from locks in a forceful promoting methodology which can be said to be one cause why buyers have trepidation regarding electric cars. A coordinated showcasing communication technique would empower Tesla Motors to accomplish more noteworthy product permeability and will lead to more noteworthy product awareness. Tesla ought to proceed to centre on inquiring about and improvement and proceed to create items like Powerwall that strengthen its maintainability identifications.

Tesla has frequently confronted the issue of postponements in satisfying conveyances to the clients and at periods the dispatch of unused vehicles has been essentially postponed. Tesla encourages issues related to security discernments of clients with respect to utilizing electric cars which fear approximately life of the battery. Tesla ought to centre on this issue related to the generation and ought to make the generation handle quickly by utilizing more and talented labourers, something else it'll need behind other competitors.

Tesla as of now is respected as one man appears because it is as it was controlled by Elon Musk who directs each and everything in the company and as a result, it is influencing the administration capabilities. Tesla should focus on this problem and contract the most excellent supervisors to create the administration that would take its trade to a diverse level. The presence of a satisfactory charging foundation is profoundly significant for Tesla. The supercharging stations created by Tesla is viewed as deficient so Tesla should focus on this issue and accept gauges quickly to create adequate charging stations across the USA to build its interest in the USA market.

Tesla should focus on expanding its creation limit at Fremont and Gigafactory else it won't prompt sufficient deals for the organization to keep up its upper hand.

The autopilot framework created by Tesla utilizes cameras and PCs as opposed to practical planning advancements and laser radars utilized by broad engines and this has brought about the significant expense. It should focus on consolidating productive planning advances and finders since that would lessen the cost to end up being a lot of helpful for the clients and increment its interest for the important highlights.

Despite having solid market capitalization Tesla deals with the issues of money (Ladonlahti, Laamanen and Uotinen, 2020). It's not been able to deliver for enormous scope because of the blockages observed in Gigafactory that has not yet had the option to accomplish full operational limit. Tesla ought to truly focus on this issue and attempt to eliminate the issues related to the creation of Gigafactory as it is pointless to have a solid market capitalization in the event that it stays unused.

Tesla needs to manage two significant shortcomings. One is deficiencies of batteries and the other is fabricating inconveniences. Toward the start, there were some specialized glitches for which assembling made issues. The creation delays have quit making Roadster. It got hard to deal with the providers. Providing batteries have gotten restricted. It has diminished Tesla's pace of creation. The entryway of vendors has hampered the extension of the concerned organization. Issues as for parts quality has likewise been recognized. There is a need for a great deal of progress to keep up its situation in the serious market. Tesla should focus on its shortcoming and improve in improving its battery range just as other related assembling intricacies.

Disregarding the way that electric vehicles need less help and less support, it is as yet basic to find a proficient labourer in the reach (Lugtu Jr, 2019). Unfortunately, 97% of fixed people are not able to put forth an attempt on electric vehicles. Of the 3%, that's, various of them work for approvals. Regardless of the way that there is a piece of cross variety vehicles in the city, they need upkeep organizations near to ordinary gas-fuelled vehicles. This suggests that people who are educated and utilized on cross variety vehicles are not scholarly roughly all-electric copies. Amazingly, electric vehicle owners have fewer options for skilful mechanics thus making it less mentioning inside the ad of the US. Tesla should focus on this issue genuinely and train individuals for building up the ability and fitness of fixing electric vehicles made by Tesla so that the organization can keep up its upper hand else it would consequently diminish the deals of the organization by and large.


At the earlier times, Tesla had a total of three CEOs including Eberhard. Musk co-founder of the company who had invested $55 million at that time and took the responsibility of the company as Chief Executive Officer from 2008 onwards by quoting “I have so many chips on the table. I need to steer the boat completely.” Many people believe that Musk is the only reason behind the success of Tesla and the spurring innovation from traditional to modern and technological shift like electric vehicles has become possible for him only. Tesla’s innovation of Model 3, the first electric vehicle of the company was introduced with certain strategies such as a low price strategy with qualified battery technology. Even in recent times, they have been holding the same strategy along with some new and unique strategy to operate their business in the US auto industry successfully.

They first took the attempt of establishing electric vehicles just because of a better future as EVs have zero-emission and people are now more dependent on these types of vehicles just to reduce pollution. Their effective strategies are the reasons for operating business in the US automobile industry and it is expected that the company can sell around 605 exclusive vehicles within 2025.

The major strength of the company is that they have a wide range of collections which helps them to create brand loyalty in the customers. They always concentrate on the line of production before launching the product into the market. Though they had faced a lobby of dealerships that hampered them a lot in doing in-store business. Apart from this issue, the company is still dealing hard to expand their business chain across the whole world but they have to deal with this factor effectively as there are a lot of strong competitors like General Motors, Ford who are also operating their business successfully.

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Self-driving cars are another added planning which is their latest innovation and has added extra value. People are now more demanding for electric vehicles over petrol diesel cars as EVs are environment-friendly vehicles that produce no pollution and that is why the company’s effective strategies suit the best for successfully operating their business in the United States along with other developed and developing countries. All of their electric vehicles are said to have better performance on roads compared to other competitors and that is why they have been earning more profit from their earlier days.

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