MBA-682 Ass#1

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Florida International University *

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682

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Business

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Feb 20, 2024

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Edwards Executive Summary Tesla, Inc. In 2003, Elon Musk and others introduced a new fleet of vehicles named Tesla that has emerged as a trailblazer in the automotive and energy industries. Renowned for its innovative electric vehicles, such as the Model S and Model 3, Tesla has redefined the perception of sustainable transportation. Beyond automobiles, the company's foray into energy solutions with products like the Powerwall and Solar Roof underscores its commitment to a holistic approach for a clean energy future. Tesla's strategic vision, coupled with Musk's unconventional leadership, has propelled the company to the forefront of technological advancements. With a focus on autonomy, renewable energy, and ambitious projects like the Gigafactories, Tesla continues to reshape the landscape of both transportation and energy, influencing industries worldwide. Tesla, the electric vehicle pioneer, has been grappling with substantial recall challenges in recent times. These recalls primarily stem from concerns related to safety, manufacturing defects, and software glitches. One notable instance involved issues with the Full Self Driving beta software, prompting the need for significant updates. Additionally, concerns over battery-related defects and fire risks have prompted widespread recalls affecting various models. These challenges have not only raised questions about Tesla's quality control but have also sparked debates regarding the rapid integration of cutting edge technologies in automotive systems. As Tesla continues to navigate these recall issues, the industry closely watches the impact on consumer trust, regulatory scrutiny, and the broader landscape of autonomous and electric vehicles.

Edwards External Analysis P - Tesla operates in a highly regulated industry influenced by government policies and geopolitical dynamics. Government support for clean energy initiatives, tax credits for electric vehicle (EV) buyers, and emissions standards are critical political factors. Tesla’s success partially relies on continuing these policies and programs, which vary from country to country. 1. Governmental incentives for electric automobiles (opportunity) 2. New global trade agreements (opportunity) 3. Political stability in the majority of major markets (opportunity) E - Deal with economic conditions and trends affecting an organization’s operations, profitability, and growth. Economic conditions strongly affect Tesla's sales and profitability. The price of raw materials, exchange rate fluctuations, and consumer purchasing power play pivotal roles. Tesla faces competition from both established automakers and emerging electric vehicle manufacturers. 1. Decreasing battery costs (opportunity) 2. Decreasing renewable energy costs (opportunity) 3. Economic stability issues (threat) S - Relate to social and cultural aspects that may influence consumer preferences, lifestyles, demographics, and market trends. Changing consumer attitudes towards sustainability and environmental consciousness have been advantageous for Tesla. The societal shift towards eco-friendly alternatives is a substantial driver of demand for electric vehicles. As people become more concerned about the health effects of air pollution caused by internal combustion engine vehicles, they may be more inclined to adopt cleaner transportation options, such as electric vehicles. 1. Increasing popularity of low-carbon lifestyles (opportunity) 2. Increasing preference for renewable energy (opportunity) 3. Improving wealth distribution in developing markets (opportunity) T - Deal with developing and applying new technologies, innovations, and trends that can impact an industry or organization. The rapid pace of technological advancements is both an opportunity and a challenge for Tesla. Breakthroughs in battery technology, autonomous driving capabilities, and software integration have positioned Tesla as an industry leader. 1. High rate of technological change (opportunity & threat)

Edwards 2. Increasing automation in business (opportunity) 3. Increasing popularity of online mobile systems (opportunity) L - Refer to the laws and regulations that govern businesses and industries. Te sla operates in a highly regulated industry, subject to various legal frameworks. Compliance with automotive industry regulations, safety standards, and product liability laws is imperative. Tesla must navigate product liability laws and manage potential recalls related to vehicle defects or safety concerns. Effective management of product liability and recalls can help Tesla maintain its reputation for quality and safety. 1. Expanding international patent protection (opportunity) 2. Energy consumption regulations (opportunity) 3. Dealership sales regulation in the United States (opportunity & threat) E - Relate to ecological and environmental concerns that may affect an organization’s operations and decision-making. E nvironmental considerations are at the core of Tesla's mission. The company's products directly address concerns related to greenhouse gas emissions and air pollution. Tesla's emphasis on sustainability, from production to operation, distinguishes it in the market. These can include energy efficiency standards, waste management regulations, and product certification requirements, all of which can influence Tesla’s operations and growth. 1. Climate change (opportunity) 2. Expanding environmental programs (opportunity) 3. Rising standards on waste disposal (opportunity)

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Edwards Internal Analysis Tesla's VRIO analysis reveals the distinctive advantages that contribute to its competitive position in the electric vehicle industry. Tesla's technological innovations, particularly in battery technology and autonomous driving, represent a valuable resource. The company's Gigafactories enable it to vertically integrate its production processes, ensuring a sustainable supply of high-quality batteries. This technological edge is rare and challenging for competitors to replicate, providing Tesla with a unique competitive advantage. The brand's strong reputation for sustainability and environmental consciousness enhances its resource of customer loyalty. Tesla's commitment to eco-friendly practices has created a valuable intangible asset that distinguishes it in a market increasingly focused on corporate social responsibility. Furthermore, Tesla's distribution and sales strategy aligns with its distinctive capabilities. The direct to consumer model and company owned showrooms allow Tesla to maintain control over the customer experience and build a premium brand image. This proprietary distribution channel is difficult for competitors to emulate, contributing to Tesla's sustained competitive advantage. The extensive Supercharger network provides a strategic resource, giving Tesla a competitive edge in addressing range anxiety, which is a common concern for EV owners. Tesla's VRIO analysis underscores its unique blend of technological prowess, brand strength, and strategic distribution, positioning it as a dominant force in the rapidly evolving electric vehicle industry. Tesla Motors VRIO Analysis

Edwards Resource or Capability Valuable Rare Inimitable Organized Advantage Brand Image Yes Yes Yes Yes Competitive Advantage Innovation Yes Yes Yes Yes Competitive Advantage Customer experience Yes Yes Yes Yes Competitive Advantage Product Range Yes No Yes Yes Temporary Advantage Market Position Yes Yes Yes Yes Competitive Advantage HRM Yes No No Yes Competitive Advantage

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MBA-682 Ass#1

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