tesla motors & the us car industry

TESLA MOTORS AND THE U.S. AUTOMOTIVE INDUSTRYJANNY ANN A. REYES

BA 190 - Strategic ManagementUniversity of the Philippines

Prof. Mita Angela M. Dimalanta

The Big Three in the US

New entries through globalization and deregulation

Large-scale production as entry barriers

Enter Mr. Elon Musk who sidesteps the high entry barriers of traditional combustion technology

TESLA MOTORS, all-electric American car company

Vision: “to create the most compelling car company of the 21st century by driving the world’s transition to electric vehicles.”

Mission: “to accelerate the world’s transition to sustainable energy.”Tesla is not just an automaker, but also a technology and design company with a focus on energy innovation.

Pric

e Ch

arge

d

BMW

Ford

Chevrolet

Performance

Nissan

Tesla Motors

Volkswagen

1. Which PESTEL(Political, Economic, Socio-cultural, Technological, ecological and legal) factors most salient for the electric vehicle segment of the car industry? Do you see a future for electric vehicles in the U.S.? Why or why not?

2. Looking at Porter’s 5 forces of competition, how would you assess profit potential of the U.S. car industry?

3. Using the 5 forces model, what implications can we derive for how Tesla Motors should compete in the U.S. car industry? What would be your top 3 recommendations for Elon Musk? Support your arguments.

4. Draw a strategic group map for the U.S. automotive industry. What are your conclusions?

REFERENCES

• Rothaermel, F. T. (2015). Strategic management (2nd ed.). New York: McGraw-Hill.

• "TESLA Motors - External Analysis Using PESTLE & Porter’S 5 Analysis". SpherePress. N.p., 2016. Web. 29 Aug. 2016.

• Kissinger, Daniel. "Tesla Motors, Inc. PESTEL/PESTLE Analysis & Recommendations - Panmore Institute". Panmore Institute. N.p., 2016. Web. 29 Sept. 2016.