Tesla: Five Forces Analysis
Threats of New Entrants
- Difficult for new entrants and substitutes to exist in this limited industry the already existing competitors within the industry could pose a threat to Tesla Motors.
- Top automotive manufacturers are watching them and they are taking que’s from Tesla Motors and their initiatives, and some are already incorporating similar concepts into their new generation vehicles
Threat of Substitute
Tesla having an aggressive approach towards the new innovations and carving out the electric vehicle niche as their own, will lead the company as the best in years to come, setting the trend for the automobile market in the future.
- Takes a lot of resources, equipment, and most of all capital to even begin to make vehicles of this nature.
- Already acquired by the already existing automotive competitors.
- Requires a huge capital in order to support an attempt, and there are not too many people with the connections, and resources at the disposal of inventor Elon Musk.
Team c
- Premium, high-performance cars are limited to a very small consumer base.
- Tesla has technology, and innovation on its side.
- The niche that they are seeking to acquire is microscopic.
- There is very little room for the existence new entrants to gain a foothold.
- Even with substitutes Tesla is unique with the innovative electric car technology
- Automotive companies are looking at Tesla strategic move.
Bargaining Power of Suppliers
Bargaining Power of Buyers
- Vehicles are not affordable by everyone.
- Buyers today are very conservative with their spending.
- Buyers are still hesitant towards the idea of electric and “eco-friendly” vehicles considering them to be not as “powerful” or “strong”.
- Relies on premium materials, components and technology.
- Suppliers are in a better position to control/manipulate prices to their advantage.
- Suppliers are in the position to charge whatever prices they deem necessary because of the exclusivity of the materials that Tesla Motor’s will need to create the vehicles.
Change is on the rise in the automotive industry so Tesla Motors will see profits and will introduce
a necessary change to the industry itself, but until the idea of electric, eco-friendly vehicles are accepted by the world’s economy, buyers will have the most impact on how fast this change is not only introduced, but accepted as well.
Tesla's Startey
Tesla Motors History
"To drive the world's transition to electric mobility by bringing a full range of increasingly affordable electric cars to market"
- Founded in 2003 by Martin Eberhard and Marc Tarpenning
- In 2004 Elon Musk became chairman after contributing 6.35 million in the first round of investment
- 2007 Ze'ev Droro was name president and CEO
- 2010 became a public company and became the firs American car to go public since ford.
Porter Five Forces Analysis