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Transcript of Tesla Motors
TIME Magazine’s 100 Most Influential People In The World list (2013)
Born in South Africa
Father: Engineer; Mother: Dietician
Hitchhiker’s Guide To The Galaxy
Invest In Production
Produce Cars & Supercharge Stations
Success: Electric Vehicles.
What should be done:
Continue to hire Grade A workers
Continue to invest in plant technology
Expand production of Supercharge Stations
Who Should do this: Peter Carlsson, VP-Supply Chain
Invest In Marketing
Success: Brought by Quality Electric Vehicles
What should be done:
Hire a Marketing Director
Increase Advertising budget
Move away from word-of-mouth sales
Why: To improve accessibility and awareness amongst market segments
Who: Elon Musk should be in charge of hiring a reputable Marketing director.
"I came to the conclusion that we should aspire to increase the scope and scale of human consciousness in order to better understand what questions to ask. Really, the only thing that makes sense is to strive for greater collective enlightenment"
More large car companies are redesigning their cars to be eco friendly
New automobile companies are entering the electric car market.
Rapid Changes in technology may make current technology obsolete
Perception of a good car for the middle class
People are still unsure of how electric cars work
People are Becoming more environmentally aware.
Government is giving tax cuts to people who drive Electric cars.
As we get out of the recession people may be willing to spend their money on luxury goods.
American Owned business.
Stanford Applied Physics Dropout
University of Pennsylvania: Economics and Physics.
Tesla’s success started off of luck
Dells Acquistion: $120 Million
Founded: Zip2, PayPal, Tesla, SpaceX
Elon Musk is extremely busy and not necessarily dedicated solely to Tesla.
First Mover Disadvantages
High long term debt.
Leadership Style: Transformational-
High Energy & Very Tolerant of Stress
Integrity & Honesty, and Emotional Maturity:
Excellent Transformative Leader: CEO Elon Musk
Workers are aligned with Tesla Motors Mission Statement & Vision.
Grade A employees
Employees are happy with their benefits.
Excellent reputations after receiving 1st place awards by various automobile magazines.
1st mover advantage in Electric Vehicles sports car industry.
Manufactures most of its own Parts.
Balanced: Transactional & Relational
Level Of Rivalry:
Large Car Dealerships
flex fuel cars
cars that run on diesel
hydrogen powered cars
cars that run on compressed natural gas
"Here's to creating the greatest car company of the 21st century and to making a real difference in the world, and to moving us off oil as fast as possible." (Gertner 106)
Threat Of Substitution:
Bargaining Power of Buyers: Medium
More Environmentally safe options
No Price Negotiations
Bargaining Power of Suppliers:Medium
Samsung Battery Negotiation
Tesla is predicted to be most important battery buyer.
Produces Most Parts In House
Produces Parts for other companies.
1. Build sports car
2. Use that money to build an affordable car
3. Use that money to build an even more affordable car
4. While doing above, also provide zero-emission electric-power generation options (pg 107)
Master Plan for Tesla
Threat Of New Entry:
Existing Large Automobile Companies
Tesla Considered New Entrant
Porter’s 5 Forces:
Electric Automobile Industry
EXTERNAL ANALYSIS INSERT
Released for those who were willing to spend their money to try out the new, luxury, electric car
Tesla realizes they need a more affordable vehicle if they wanted to really get their name out there.
Very high priced, sports car ($119,000)
Musk co-founded PayPal, SpaceX, and of course Tesla Motors
PayPal - convenient form of payment offered by many companies that work with PayPal
SpaceX - launches advanced spacecrafts
FIRST MOVER ADVANTAGE YES YES YES YES
HYBRID CARS YES YES YES NO
CEO ELON MUSK YES YES YES NO
Globalization Presence and Effects
HARD TO IMITATE
Responsible Wealth Creation
General Administration: Experts Hired
HR Management: Excellent Benefits
Technology Developed: High Tech Facilities & Improved national Electric Vehicle Infrastructure.
Engagement & Plan Allignment
Factories are made to make employees happy:
Magnetic Strip Production Line
Workers with technology & automotive background
Inbound & Outbound Logistics: Hired Experts
Operating: 30% decrease in operating costs; Potential to earn $880 million in operating income; Max Capacity: 500,000 Cars
Marketing & Sales: Minimal- Word of mouth
4- Year Plan
4- Year Plan + Extension
4-Year Anywhere Plan
4- Year Anywhere Plan + Extension
“Tesla's new $50,000 four-door electric sedan, the Model S, is assembled on wheeled platforms that follow a magnetic strip that snakes through the factory floor. Engineers huddle at workstations scattered throughout the factory, giving them the ability to tweak the car's design at a moment's notice. ‘It's simple for us to reconfigure our lines,”
-Gilbert Passin, Tesla Motor’s Manufacturing Chief
Tesla Service for 1 year or 12,500 miles
Tesla service for 4 years or upto 50,000 miles
Tesla Service for 8 years or 100,000 miles
Tesla Service for 4 years upto 50,000 miles Unlimited Tesla Ranger Service
Tesla Service for 8 years upto 100,000 miles with Unlimited Tesla Ranger Service
Engagement & Plan Alignment Cont'd
$600 at annual Inspection
Corporate Culture & Worker Benefits
primary value of improving humanity is felt throughout the company
“Create the benefits of the future. Create it for our company. Make it unique. Make it awesome”- Nate Randall, Tesla Motor’s Benefits Manager
Emphasis on Environment
Showers at facilities
Excellent Salary & Wages
Corporate Culture & Worker Benefits
“At Tesla, I always felt like part of something big. The projects I worked on were always important even though I was only an intern”
Musk was doubtful of Tesla at first
Less than 50% chance of success
85 - 90 hours/week
Very hands on
Telsa Motors Inc. Was Founded by Martin Eberhard & Mark Tarpenning
Elon Musk Invests & Becomes a Board Member
Tesla Motors Inc Announce plans to open a plant in New Mexico
Eberhard was ousted from his position at Tesla.
Tesla sells 2,150 vehicles for $109,000
California Gives Tesla Motors a tax break. Tesla Moves facility to Los Angeles instead.
Elon Musk was made a CEO
Tesla gets a low interest loan from the US Department of energy for $465 million to produce Model S cars
Tesla Registers for an initial public offering of stock
Tesla purchases and refurbishes a former Toyota factory. Toyota agrees to work with Tesla on electric vehicle development.
Two of Tesla's key engineers resign on the same day resulting in a decrease in shares. Tesla stops producing the Roadster.
Announces it will open its first retail store in White Plains NY
Wells Fargo & Tesla partner up to provide competitive retail financing options for customers.
Tesla Reveal opening of 10 new retail stores and 6 super charger stations in California, Nevada, and Arizona.
Won Automobile Magazines "Automobile Of The Year" and Motor Trends "2013 Car Of The Year"
Tesla paid off in full its loan that it recieved from the Department of Energy- being the first car company to fully repay the government.
Tesla also announced its would expand its super charger network to allow customers to travel longer distances.
Respect foreign policies
training sessions avaiable
Conflict of Interest
receiving goods, gifts, or even loans
working for the competition
inappropriate use of social media
disclosure of information
Petroleum is a limited resource
Petroleum fuels 95% of the transportation sector
28% of total energy use
Tesla vehicles cut in half the carbon dioxide emissions of its petroleum-burning rivals
Reduce cost of battery and improve the charging infrastructure
90 Second Battery Swap
Home charging port
Other charging ports
Economic forces: Fluctuating gas prices
Technological forces: Technology progresses everyday
Tesla (along with other car companies) have to keep up
Technology makes cars more expensive
Sociocultural forces: More concern for the environment
More people are interested in hybrid or electric cars
Young adults buying their first car (ages 18 - 25)
Tesla is not targeted toward them
Well off, middle/high class (ages 40+)
Looking to upgrade
Federal loan for $465 Million
$7,500 tax break to customers
Global forces: Countries like Japan could get a hold of this technology or possibly duplicate the idea with their own technology
Competition from larger automotive makers can release new fully electric vehicles and have the capabilities to manufacture more vehicles at cheaper cost and have lower costs to consumers.
Long term debt can be detrimental to the health of the Tesla overtime the interest could overwhelm the corporation putting it out of business. Tesla currently has over $414.2 million in long term debt
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