Tesla Motors Incorporation is a company located in Silicon Valley. The company develops, produces, and sells electric vehicle powertrain elements and electric cars. In addition, the public company uses the symbol TSLA while trading on the NASDAQ stock exchange. Tesla Motors attained extensive attention by manufacturing the Tesla Roadster. This was the foremost complete electric sports car. The company has situated itself among the leading actors in America’s motor vehicle sector (Garcia-Valle and Lopes 33). This paper is a case study of Tesla Motors Incorporation and will look at the company’s objectives, customer scenario, Identifications of the nucleus of Control, and functional analysis.
Tesla Motor’s product-mission philosophy is to design and develop the most sophisticated electric powertrains and electric vehicles in the entire universe. The company does not bargain on appeal, performance or innovation. Also the company does not compromise on its dedication to employing and advancing the best individuals from all over the universe. In addition, the company operates in trivial, engaged units which, much like the company products, are adequate, responsive, and directed on excellence. The company is motivated by activities that play a part to a worldwide effect and is zealous about the future in the motor industry (Garcia-Valle and Lopes 33).
We can determine whether or not the mission of Tesla Motors has been carried out by establishing if the company is benefiting from reduced costs for its own products. In addition, we may establish whether or not the mission of Tesla Motors has been carried out by ascertaining if the company is able to sell its products to different actors in the motor vehicle industry, consequently, providing an enhancement of revenue that helps the company to continue to exist through difficult economic times (Garcia-Valle and Lopes 33).
The target market of Tesla Motors includes executives, present owners of the Roadster model, and wealthy households. Tesla Motors Incorporation’s pricing since its inception has been targeting the middle class and the upper class groups. Marketing to upper level earning individuals at a period when the baby boomer generation has developed financially and has been brought up to experience a life of luxury has contributed significantly to the company’s success. People from the baby boomer generation still have the ability to drive fats and luxurious vehicles, and they can afford them (Best 46). The upper class and middle class group are keen on an automobile with an attractive design, a vehicle which does not require tremendous space for carrying other people or goods, a vehicle that can be effortlessly noticed, and a vehicle that has no need for long distance travels, which is provided by Tesla Motors Incorporation.
The individual who has control of and in essence calls the strategic shots for Tesla Motors Incorporation is the chief executive officer and product architect, Elon Musk. At Tesla Motors Incorporation, Elon Musk has watched over the development of products and designs from the inception. This includes the all electric Tesla Model X, Roadster, and Model S. Another of his foremost interests for a long time has been changing to a sustainable energy market, in which electric motor vehicles play a significant part. This has been evident since his era as a physics learner developing the ultracapacitors in Silicon Valley. Moreover, the chief executive officer is largely responsible for the business plan that attempts to provide economic electric automobiles to large-market customers. Elon Musk has planned the selling of electric vehicle powertrain elements and building of these components so that other vehicle makers can manufacture electric automobiles at cheap costs (Garcia-Valle and Lopes 34).
The top management of Tesla Motors Incorporation is made up of the chairman, chief technical officer, chief financial officer, vice president of manufacturing, chief designer, vice president of the human resource department, and vice president of business development (Garcia-Valle and Lopes 33).
Elon Musk is the chief executive officer, product architect, and chairman of the company. Elon Musk co-established Tesla Motors and continues to supervise the product strategy of the company, including engineering, outlining and production of a large number of cheap electric automobiles for mainstream clients. As product architect and chairman, Elon Musk assisted in designing the innovative Tesla Roadster (Garcia-Valle and Lopes 33).
JB Straubel is the chief technical officer. He is a co-founder of Tesla Motors, and has supervised the engineering and technical outline for the automobiles, concentrating on the power electronics, motor, battery, and advanced software sub-systems. Moreover, Straubel assesses novel technology, deals with, technical interface with significant vendors, and is in charge of vehicle systems testing (Garcia-Valle and Lopes 33).
Deepak Ahuja is the chief financial officer. He brings priceless information of a familiar sector veteran to assist the company turn into a fundamental motor vehicle organization in the universe.
Gilbert Passin is the manufacturing vice president. He has approximately twenty three years of experience in the international motor vehicle industry. He was the leader of a number of glamorous companies, for example, Renault, Toyota, Mack, and Volvo all over Europe and North America (Garcia-Valle and Lopes 33). He is in charge of manufacturing the electric vehicles and electronic components in the company.
Franz Von Holzhausen is the company’s chief designer. He is charged with the responsibility of directing the general design of Tesla Motors Incorporation, and is has the mandate of developing a world class model competency for all imminent production vehicles and design concepts (Garcia-Valle and Lopes 33).
Arnnon Geshuri is the vice president of human resources in Tesla Motors. He has the duty of handling human resource activities and the worldwide recruitment attempts (Garcia-Valle and Lopes 33).
Finally, Diarmuid O’connell is Tesla’s vice president of business development. His responsibility as the vice president of business development at Tesla Motors is to manage every component of government affairs and commercial relations (Garcia-Valle and Lopes 33).
One of the company’s goals is to add the variety and number of electric vehicles available to customers through quality production, affordable pricing, sufficient promotion, and proper placement (Garcia-Valle and Lopes 33). The company sells its automobiles online and in numerous company-owned showrooms. The company also patents electric powertrain elements to its competitors so that it provides their electronic vehicles to clients sooner. The vehicle prices were earlier placed at US$ 109,000. The company’s objective is to sell these vehicles to mainstream clients at reasonable prices.
The real and nominal yearly earnings growth rate has been largely inconsistent for numerous years yet correct revenue growth rate and annual growth rate have both have a mean of approximately 78% with the most significant revenue rise in 2009. This form of now and then severe yearly revenue rise is extremely difficult on the balance sheet resources of the company (Garcia-Valle and Lopes 33). By the end of the third quarter of 2012, the gross earnings mark-up index lessened a remarkable 27%, causing a decrease in total earnings difference of 81% and 87% in total revenue dollars. By the year 2012, a person could purchase a car from Tesla Motors for the price of manufacturing with no or little mark-up on the fees to manufacture.
When looking at the financial health of Tesla Motors Incorporation, we want to determine if the company’s finance is sustainable. Tesla Motors Incorporation filled Form S-1 with the Securities and Exchange Commission as an initial guide illustrating its intent to file an Initial Public Offering. The company initiated its initial public offering on January 29th in the year 2010 on NASDAQ under the initials TSLA. The initial public offering attained US$226 million for Tesla Motors Incorporation. The first three years of the last four were entirely unsustainable. In a sense, Tesla Motors Incorporation is surviving on the financial statements resources identical to individual exhausting their emergency savings account. Tesla Motors Incorporation turned stoutly sustainable, in 2012, even though principally because of a solid deceleration in sales on the basis of yearly earnings. In addition, sales in the last four years have been to some extent constant, ranging from $112 million in 2009 to yearly earnings of approximately $143 million on the basis of the year to date third quarter outcomes. The expenditure of manufacturing is going up and the net operating revenue is diminishing with five years of deficits and rising. Money is not a significant determinant for the company’s survivability in comparison to surplus generation of finances. Finances may be obtained from extra debt or equity financing but surplus finance creation may only emit from working capital and Tesla Motors Incorporation is successfully and aggressively lessening its working capital requirements (Garcia-Valle and Lopes 33). This is the sole encouraging section in the finances of the company. All kinds of return on asset are not positive, consuming 30% to 40% of the capital in the balance sheet. Finally, its return on asset is a standard negative 28% yearly.
Tesla Motors Incorporation manages its individual stores, asserting it replicates its showrooms on those of retailers, for example, those of Starbucks and Apple. The company’s operations management takes note of managing quality and process and design capacity design (Garcia-Valle and Lopes 33). It is evident that the operations management of the company has transformed critical elements of its manufacturing due to the large number of motor vehicles they have been producing (Morgan 96). In 2011, Tesla Motors Incorporation changed from hand-produced alpha builds to beta build, production validation automobiles completely manufactured at the Tesla Motors industrial unit. These motor vehicles are utilized for federal crash-testing and certification, engineering testing, and system integration.
On April 14, 2008, the company filed a case against Fisker Automotive, claiming that Henrik Fisker pinched design plans and classified details associated to the design of electric and hybrid vehicles and was utilizing the details to make the Fisker Karma. Magna International filed a case against Tesla Motors Incorporation in March 2008 asserting that it was not reimbursed for the services it provided. The company employed Magna International to assist outline a 2-speed transmission for the Roadster. A lawsuit was also filed in May 2009 to determine who the right founder of the company was. The case involved Eberhard, Musk and Tesla Motors. Nevertheless, the case was subsequently abandoned after a settlement out of court. Finally, in 2008, The Company filed a case against Top Gear for their review of the Tesla Roadster in an event in which Jeremy Clarkson could be viewed driving a Roadster near the Top Gear test track, protesting about a reach of 89km prior to the car being thrust into the garage, apparently lacking charge (Garcia-Valle and Lopes 34).
Research and Development
The company researches, develops, and produces motor vehicles that demonstrate effectiveness, performance, and design while coinciding with all American durability, environmental, and safety standards (Daniel and Radenbaugh 47). Tesla Motors has taken more than 400 stipulations for its motor vehicle, the Tesla Roadster, a high performance and stylish sports automobile that picks up the pace to 60 mph in approximately 4 seconds with extreme energy sufficiency. The company has facilities which permit it to perform qualification testing, quick turnaround, validation testing, experimental testing, and incorporate quality into their commodities from the start. The research is based on the presumption that the electric vehicles are a standard answer because there is no emission that is emitted adequately in the operation, the electric engine is less complicated compared to conventional, hydrogen, and hybrid vehicles, and no fuel is utilized during the process.
Arnnon Geshuri is the vice president of human resources in Tesla Motors. He handles human resource activities and the worldwide recruitment attempts. Currently, the company has employed close to 3,000 employees on a full time basis. The human resources department recruits employees who put business interests first and with admiration and respect for the craft of manufacturing, analytics, and engineering. The employees have demonstrable common sense and are extraordinarily straight. Moreover, the human resources department promotes initiatives that solidify the culture of the company, anticipate concerns before they occur, and augment the experience of workers (Daniel and Radenbaugh 81). Finally, the employees are willing to think outside the box, are strategic, and responsive.
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