We have previously written an outright SWOT analysis of Hyundai. This time we are back with another article on the SWOT analysis of Tesla.
Tesla Inc. was a Silicon Valley-based American start-up. Tesla was named after Nikola Tesla, a well-known inventor, and scientist of the period. He was a pioneer in radio technology and electrical engineering.
Tesla, Inc., formerly Tesla Inc., has risen to the pinnacle of success as a dynamic automotive and energy solutions company. Because of its strong position in the market, it is known for its creative approach. Tesla has become one of the most talked-about and studied businesses among business aficionados.
Digital marketing has played a major role in the success of Tesla. Keeping yourself upgraded with the latest digital marketing trends by attending the Free Masterclass on Digital Marketing 101, hosted by Karan Shah, CEO and Founder of IIDE is very important. Book your seat now.
Now, right before we delve into the SWOT Analysis of Tesla, let’s look at the background of the company, its founders, financial status, competitors, and products.
Nicolai Tesla, a prominent scientist and inventor, was the inspiration for Tesla Inc., which was created in 2003. Tesla has become one of the top vehicle businesses in the world because of its energy-saving technique and luxury-focused designs. In February 2004, Elon Musk met with Martin Eberhard and Marc Tarpenning, the original creators of Tesla, and provided US$6.5 million to the initial US$7.5 million round of funding.
Tesla’s renewable energy approach transformed the vehicle industry and had a tremendous worldwide influence. The Roadster, Tesla’s first car, was the first automobile to employ lithium battery cells. Tesla, based in California, has grown in popularity among the American public as a high-end electric vehicle with an original design.
|Founder||Martin Eberhard & Marc Tarpenning|
|No. of Employees||70,757|
|Market Cap||$388.97 billion (2022)|
|Annual Revenue||$81.46 billion (2022)|
|Net Income/ Profit||$12.56 billion (2022)|
Products by Tesla
- Model S
- Model X
- Model 3
- Model Y
- Powerwall, Powerpack, and Megapack
- Solar panels and Solar Roof
- Tesla Energy Software
What’s New about Tesla?
Here’s everything buzzing about Tesla recently:
- Tesla has announced a concept of Dojo – a supercomputer that will train AI models for better automation and functionality in their electric vehicles. Morgan Stanley has predicted that the market cap of Tesla will boost by nearly $600 billion.
- Tesla also introduced a new Powerwall 3, a solar battery system that can help domestic homes with their power needs.
- A new concept of Robotaxi did rounds of the internet – a concept devised by Elon Musk, as discovered in the new Elon Musk biography by Walter Isaacson.
Let’s now answer the million-dollar question, What’s happening with Tesla in India?
What’s the deal with Tesla manufacturing in India?
More and more foreign manufacturers want to shift their manufacturing bases to India because of the stable Indian economy & access to large labor supply at cheaper rates.
Similarly, Tesla’s founder Elon Musk is serious about entering the Indian market by also manufacturing in the country itself.
Here’s how the talks between Tesla & the Government of India have been till now:
- Two senior executives of Tesla had a meeting with the CEO of Invest India, Nivruti Rai, on 27th July 2023 representing the company’s plans to set up a manufacturing plant in India.
- They also had a meeting with Commerce and Industry Minister, Piyush Goyal regarding the same.
- The discussion regarding the setting up of manufacturing plants of cars and batteries in India by carmakers has been on since Elon Musk met PM Modi on his US visit last month.
- Piyush Goyal and Elon Musk also had a Virtual meeting regarding Tesla’s manufacturing presence in India.
- Currently, Tesla is manufacturing in China, the US, Germany, Mexico, Canada, and the Netherlands.
- The government has not accepted the demand of Tesla for selling cars in India at lower duties, instead, the government wants Tesla to manufacture in the fast-growing market of India.
- The current rate of import duty is 60% for those priced below $40,000 and 100% for the above. Whereas Tesla wanted the import duty to be 40% on fully assembled electric cars.
- Tesla leases a space in Pune for its first-ever office in India in August 2023.
These are the developments as of August 2023 & netizens are confident that the Government of India will strike a winning deal with Tesla.
Manufacturing in India will reduce the heavy pricing of imported Tesla cars for Indian consumers.
User Persona of Tesla
Let’s look at an ideal customer of Tesla and what are their attributes, motivations & social media presence.
- Tech and innovation enthusiast
- Eco-conscious, supports sustainability
- Seeks premium electric cars for status
Interest & Hobbies
- Electric vehicles & tech
- Outdoor activities
- Home automation & smart tech
- Initial Tesla cost
- Charging infrastructure concerns
- Maintenance & resale questions
Social Media Presence
- EV Forums
Now, having known the ideal customer of Tesla, let’s dive deeper into the strengths, weaknesses, threats, and opportunities of Tesla.
SWOT Analysis of Tesla
SWOT Analysis of Tesla can show how a well-established company uses its opportunities to ensure its growth. It can show how the company takes advantage of its strengths to use the opportunities while working on its weaknesses. SWOT Analysis of Tesla will also reveal its expansion plans.
To better understand the SWOT analysis of Tesla, refer to the infographic below:
Now first let’s begin with the strengths of the company from the SWOT analysis of Tesla.
Strengths of Tesla
- An Employer of Choice: Any company is only as good as the people it hires. In the case of Tesla Inc., it is one of the most important aspects contributing to the company’s extraordinary success. Tesla has emerged as an excellent firm for employees, thanks to its diversity and innovation-friendly culture.
- The Most Valuable Automobile Firm: Tesla’s sales on a global scale were 9,50,000 units in 2021 which is an 87% increase over the previous year. The company’s market capitalization increased to approximately $208 billion, surpassing Toyota’s $202 market capitalization to become the world’s most valuable carmaker by market value.
- Strong Organization: There are characteristics of a corporation that assist it in achieving its objective. For instance, substantial financial resources, personnel expertise, brand loyalty, products and services, and so on.
- Positioning: Tesla positions their cars as vehicles that can provide driving experiences that exceed customer expectations. Their cars are also exceptional in terms of styling and achievement. Also, the kilometre range of its cars is extremely impressive which is 600 kilometres on a single battery charge.
- Effective Marketing Strategies: Tesla is worldwide famous for its 0$ marketing strategy. That’s right. Tesla does spend any funds on its marketing other than its launches. This sounds very strange but this is true. Tesla has leveraged multiple benefits from its operations and directed those leverages into its marketing strategies.
- Innovation: Tesla has not just been creative in the design and styling of their cars but has also been involved in a lot of research on alternative energy vehicle options such as hybrid cars, hydrogen cell power-powered electric cars, and plug-in hybrids.
- Market Dominator: Tesla is one of the biggest dominates in the US in terms of electric vehicle sales. Along with Ford and GM, Tesla is recognised as one of the “Big Three” players in the electric car market.
Weaknesses of Tesla
- Mechanical Complications: Due to their higher standard of innovation causes certain production and mechanical delay in terms of launching product such as the manufacturing of their Model X got delayed due to frequent innovative changes.
- Battery Shortage: As Tesla’s most of the businesses depend upon battery electric vehicles and plug-in electric vehicles which sometimes cause shortage of the supply of batteries. This directly affects the sales of electric vehicles and energy storage systems.
- Employee Turnover Rate: It has a high employee turnover rate, with low employee enthusiasm and working confidence. Recently, Tesla got fined to follow unethical working system which caused impact on workers safety.
Opportunities for Tesla
- Untapped Markets: The most important opportunity of Tesla right now is to tap into Asian market which is India where the market of EV, automation and renewable energy is growing rapidly.
- Affordable Cars: Tesla is working on launching its affordable cars so that people of every class can access the innovation of Tesla. Such as its recently launched Model 3 which is a more affordable version of Model S.
- In-house Battery Production: Tesla can launch its own battery cells which will reduce the dependency of Tesla on Panasonic which is its primary supplier of batteries. This move could be a big game changer for Tesla if implemented.
- Technological Developments: Technology succeeds with numerous advantages among many departments. Operations can be automated to diminish costs. Technology enables better data to be obtained from customers and improves trading accomplishments.
- Autonomous Driving Technology: Tesla’s autopilot technology has gained fame for its safety and convenience. Making it trustworthy by consumers and the share market. Tesla’s work in autopilot is constantly evolving.
- Environment-friendly Cars: As consumers are becoming more environmentally conscious, the need for more electric vehicles is growing along with the need to minimize fuel-driven cars.
Threats to Tesla
- Technological Developments by Competitors: New technological developments by a few competitors within the industry pose a threat to Tesla. Buyers attracted to this new technology can be lost to competitors, reducing Tesla’ overall market share.
- New Entrants: There have been various players that have entered the market and are gaining market share by gaining the existing company’s market share. This is a threat to Tesla as it can lose its buyers to these new entrants.
- Controversies: Tesla has been the subject of several lawsuits and controversies arising from statements and acts of CEO Elon Musk and from allegations of creative accounting, whistleblower retaliation, worker rights violations, and unresolved and dangerous technical problems with their products.
- Increasing Competition: There has been an increase in competition within the industry putting downward pressure on rates. This could lead to reduced earnings for Tesla if it adjusts to the price differences, or loss of market share if it doesn’t.
- Exchange Rate: The exchange rate maintains a varying rate and this affects a company like Tesla that has sales internationally, while its suppliers are regional.
This ends our complete SWOT analysis of Tesla. Let us conclude our learning below.
Does Tesla have any failed marketing campaigns?
Tesla and its founder Elon Musk believe in a $0 marketing strategy.
Their major source of advertising comes from the thought leadership of Elon Musk and how his unique ideologies have made electric vehicles mainstream.
The brand is also followed widely by those who are fans of Nikola Tesla and who sympathize with his life’s story.
You can call Elon Musk’s recent Twitter & X fiasco a negative publicity for Tesla but it has only moved the company green on the stock market.
The motor production organization of Tesla has developed several elements to increase its commercial enterprise horizon. They made numerous improvements in layout, and styling in addition to capabilities to offer the most reliable first-rate of offerings to their clients internationally.
Tesla has never tried to be aggressive with their digital marketing efforts, so the scope to utilize the big umbrella of digital marketing is even bigger. As we said in the middle of the article, gaining the requisite skills in this field and completing certified courses may lead to employment opportunities with famous corporations such as Tesla.
Just like IIDE offers an Online Digital Digital Marketing Course which includes all requisites and areas of digital marketing. The course is taught by subject-area experts and digital enthusiasts. The course curriculum is curated and fine-tuned with the help of their know-how and experience. Their knowledge and expertise are instrumental in molding our students into skilled professionals of the future.
We hope this blog on the SWOT analysis of Tesla has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.
If you enjoy in-depth company research just like the SWOT analysis of Tesla, check out our IIDE Knowledge portal for more fascinating case studies.
Thank you for taking the time to read this, and do share your thoughts on this case study of the SWOT analysis of Tesla in the comments section below.