The Microenvironment

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Kenyatta University *

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Marketing

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Nov 24, 2024

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1 The Microenvironment: Marketing Journal Antwon Phillips Troy University Principles of Marketing MKT-3300-XTIB 23/T2 Dr. Akins Ogungbure October 29, 2023

2 The Microenvironment: Marketing Journal Introduction The microenvironment surrounding a firm plays a crucial role in shaping its strategic functions. For Tesla Inc., a leader in the electric vehicle sector of the automotive industry, these macro environmental elements have a significant impact on its operations. This post goals to examine three key macro environmental factors namely the economic, technological, and environmental factors while analysing the manner in which they influence Tesla Inc.’s strategy, with a specific focus on the company’s Tesla Model 3. Economic Factors Economic factors hold an important space in the aforementioned firm's strategic considerations. Tesla Model 3’s affordability as well as desirability forms some of the factors closely linked to consumers' economic well-being. During times of economic prosperity with rising incomes, consumers are more inclined to invest in electric vehicles like the Model 3. However, economic downturns may steer consumers towards more budget-friendly options. As a result, such economic factor impacts on Tesla's sales in a more negative way (Belli et al., 2018). Furthermore, government incentives and subsidies play a fundamental role in which favourable economic conditions, where governments promote sustainable transportation and offer financial incentives for electric vehicles, can significantly boost demand for the Model 3. Technological Factors Today the automotive industry is among the most rapidly evolving industries in which modern technology is at the forefront of Tesla's strategy. There are several ways in which technological factors influence Tesla Model 3. Firstly, battery technology stands to be an important innovation that defines the wellbeing of electric vehicles (Abboud et al., 2021).

3 Breakthroughs in battery efficiency, capacity, as well as charging speed provide this vehicle with a competitive edge in the market. Therefore, continuous investment in research and development within this realm is of importance for this giant company to maintain its leadership. As if that is not enough, advancements in autonomous driving technology have direct implications for this product. Advancement in autonomous as an important field can enhance the Tesla Model 3’s features and make it more attractive to consumers. As such, technology not only affects the product's core components but also its overall appeal and functionality (Belli et al., 2018). Environmental Factors Sustainability today has become an objective that every organization want to achieve. Tesla has not been left out as it focusses on this aspect align with the growing influence of environmental factors. Global environmental regulations demand the automotive industry to product machines with minimum environmental impacts (Belli et al., 2018). Tesla Inc. vehicles including Model 3 are well fit within these regulations, thus, a factor that grants this company a significant advantage hence, opening new markets as well as bolstering the appeal to their products, Model 3 being on the forefront. Additionally, consumer attitudes towards sustainability are increasingly favourable (Abboud et al., 2021). Tesla’s Model 3 vehicles is an electric car, that resonate with environmentally-conscious customers across the world. Such as shift in consumer values comes with a positive impact on market positioning as well as demand for the Model 3. In conclusion, the giant automotive company Tesla's strategic functions are intricately related to the microenvironment in the dynamic landscape of the electric vehicle industry. Economic, technological, and environmental factors come with a pack of unique challenges and opportunities. In order for Tesla Inc. to maintain its competitive edge and capitalize on its

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4 Tesla Model 3 and other product offerings, there is need for the company to adapt to the macro environmental elements. This company can continue to enhance its market presence while promoting sustainable growth by staying attuned to these factors. The relationship between these macro environmental elements and the company’s strategy is an ongoing process that shapes not only the Model 3 but the future of electric mobility.

5 References Abboud, M., El Hafyani, H., Zuo, J., Zeitouni, K., & Taher, Y. (2021, April). Micro- environment recognition in the context of environmental crowdsensing. In Workshops of the EDBT/ICDT Joint Conference, EDBT/ICDT-WS. Belli, C., Trapani, D., Viale, G., D'Amico, P., Duso, B. A., Della Vigna, P., ... & Curigliano, G. (2018). Targeting the microenvironment in solid tumors. Cancer treatment reviews, 65, 22-32.

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