Tesla Motors aims to accelerate sustainable transport by bringing compelling electric cars to mass markets. It was founded in 2003 and currently produces the Roadster sports car and Model S luxury sedan. Tesla's core competencies include generating enthusiasm for its brand, utilizing cutting-edge technology, and a willingness to take risks. These competencies help Tesla differentiate itself from competitors and create value for customers. However, Tesla faces future challenges as larger automakers adapt and resistance emerges to Tesla's sales model as it aims to reach broader markets.

1. TESLA MOTORS
The Presentation
Michiyo Fukuhara
Eric Watson
Luke Freitas
Erdem Tokmakoglu
1

2. PRESENTATION FLOW
AGENDA
2
INTRODUCTION
3
COMPANY
OVERVIEW
5
STEEPLED
4
POSITIONING
6
PORTER’S FIVE
FORCES
7
INTERNAL
ANALYSIS
8
TESLA’S CORE
COMPETENCE
1
RESEARCH
TOPIC
9
LESSONS
10
FUTURE
CHALLENGES

3. RESEARCH TOPIC
TESLA MOTORS INC
How does Tesla’s core competencies and other
internal factors affect it’s success
in its external environment?
3

4. INTRODUCTION
ANALYSIS
12850
“to accelerate the advent of sustainable
transport by bringing
compelling mass market electric cars to
market as soon as possible”
31
Different Countries
Mainly US, Japan,
Norway
64%
Increased its
market share
2002
Founded in Silicon Valley by Elon Musk,
Marc Tarpenning, and Martin Eberhard
$52400
“Motor Trend Car
of the Year Award”.
4.2 Sec to 100 KM/h
5 Star Safety
30 Min Charging
8 Year Warranty
300M (482 KM) Range
Units Sold
in 2013
2,964 Employees 760 % Improvement
4

5. COMPANY OVERVIEW
TESLA MOTORS INC
5

6. TESLA PRODUCT ROADMAP
COMPANY OVERVIEW
I
Founded in 2003
By Martin Eberhard,
Marc Tarperinning
I
Elon Musk Joined
With Series A Investment
in February 2004
I
Tesla Roadster
Shipping since 2008
sold over 1,800 in
over 300 countries
Over 13 million miles driven
I
Tesla Roadster
Shipping since 2008
sold over 1,800 in over 300 countries
Over 13 million miles driven
2013
VEHICLEMARKETING
20 KWh EU VERSION APAC VERSIONMODEL X RIGHT HANDED DRIVE, ALL WHEEL DRIVETHIRD GENERATION
EU & ASIA MARKETING LAUNCHESRIGHT HAND DRIVE COUNTRIES SECOND TIER CITIES
STORE, SERVICE CENTER AND SUPERCHARGER NETWORK EXPANSIONS
2014 -20152015-2016
I
Tesla Model S
Available since
mid 2012
20,000 Expected Unit
sales per year
Worlds first EV Sedan
21,000 DELIVERIES
MARKET SHARE GAINS &
PRODUCT EXTENSION
HIGHER VOLUME AT
LOWER PRICE POINT SOURCE:TESLA 6
“ONLY A DESIRABLE CAR CAN ACHIVE SUCCESS.”

7. MEET THE KEY PEOPLE
COMPANY OVERVIEW
CEO CTO CFO
CHIEF
DESIG
7
ELON MUSK JB STRAUBEL DEEPAK AHUJA FRANZ VON
HOLZHAUSEN
SPACE X
PAYPAL
SOLARCITY
INNOVATOR OF THE YEAR FORD, KINMATIC MAZDA. AUIDI. GM
“Revolutionary in every sense”
ELON MUSK

8. EX GM-TOYOTA FACTORY
AKA JUDO Economics
COMPANY OVERVIEW
8

9. COMPANY OVERVIEW
TESLA’S MISSION
A Clean Start
Where the company takes a Silicon Valley
approach to constantly innovate
Committed to Electric
On the belief that their
products should offer
the most efficient and sustainable
path to the future
Build Around the Driver
on the belief that their products
should offer the most efficient
and sustainable path to the future
Sparking the Revolution
to lead the way
and be fun to drive.
9

10. 10
TESLA MODEL S

11. 11INTERIOR

12. Buy or DO?
COMPANY OVERVIEW
12

13. POSITIONING
TESLA MOTORS INC
13

14. TESLA MARKET POSITIONING
POSITIONING
Internal
Combustion
Hybrid Electric Plug-in Hybrid Pure Electric
Performance Vehicles ROADSTER
Premium Vehicles
MODEL S
MODEL X
Small Premium
Vehicles
GEN 3
Family Vehicles
Subcompact City
Vehicles
SOURCE:TESLA 14

15. SERVICE CENTER GEOGRAPHICAL DISTRIBUTION
POSITIONING
15

16. SUPERCHARGER NETWORK
POSITIONING
16
2013 -2015
ZERO RENT COST & ALMOST ZERO ELECTRICITY COST
MAGNET TO HIGH END CONSUMERS & FREE OF CHARGE

17. AVAILABLE MODELS AND SALES
POSITIONING
SOURCE:HYBRIDCAR.COM
Existent PEV & PHEV Models
OEM Model Type First Year on Market Sales to Date
Smart
Fortwo Electric
Drive
BEV 2011 564
Tesla Roadster BEV 2008(N/A) 1650
Tesla Model S BEV 2012 12850
Toyota Rav4 EV BEV 2012 600
Toyata Prius Plug-in PHEV 2012 16963
BMW Active E BEV 2012(N/A) 969
BMW i3 BEV 2013 0
CODA coda sedan BEV 2012(N/A) 78
Detroit Electric SP:01 BEV 2013 0
Fiat 500e BEV 2013 0
Fisker Karma PHEV 2012 1800
Ford Focus Electric BEV 2011 1583
Ford C-max Energi BEV 2012 4856
Ford Fusion Energi BEV 2012 1584
GM Volt PHEV 2010 41050
GM Spark EV BEV 2013 27
Honda Fit EV BEV 2012 384
Honda
Accord Plug-in
Hybrid
PHEV 2013 200
Mitsubishi I-MIEV BEV 2011 1390
NIssan Leaf BEV 2010 29332
Expected Market Entrants
OEM Model Type
First
Year on
Market
Sales to
Date
Audi A3 e-tron PHEV 2014 0
BMW i8 PHEV 2014 0
BYD e6 PHEV 2014 0
GM Cadillac Ev PHEV 2014 0
Mitsubishi
Outlander
PHEV
PHEV 2014 0
Nissan Infinit LE BEV 2014 0
Porsche
Panamera S
E-Electric
PHEV 2014 0
Tesla Model X BEV 2014 0
17

18. 2013 Vehicle Expected Sales
IncreaseinSales
-0,3
0
0,3
0,6
0,9
1,2
Unites
0
25000
50000
75000
100000
GeneralMotors
Chrysler
TeslaMotors
ToyotaMotor
HondaMotor
Nissan
Audi
Volkswagen
MitsubishiMotor
MazdaMotor
HyundaiMotor
BMW
Mercedes-Benz
VolvoCars
Subaru
KiaMotors
Jaguar
Porsche
Oct 2012 Oct 2013 %Change
%64 INCREASED
SHARE
SOURCE:AUTODATA
18

19. 2013 INDUSTRY & TESLA GROWTH
POSITIONING
2013 Q1 Sales
0
1250
2500
3750
5000
Model S S Class BMW 7 A8
1.4622.338
3.077
4.750
SOURCE:CNN NEWS
SOURCE: HYBRIDCARS.COM
19

20. EXTERNAL ANALYSIS
STEEPLED
TESLA MOTORS INC
20

21. PEV IN THE FUTURE
POSITIONING
SOURCE:Electric Vehicle Market Forecasts 21
Estimated Cost of EV Batteries
SOURCE:Electric Vehicle Market Forecasts
EIA Oil Scenerious

22. EV SALES TARGETS
POSITIONING
SOURCE:BLOOMBERG
22

23. MARKET SHARE EXPECTATIONS
POSITIONING
SOURCE:BLOOMBERG
23

24. STEEPLED
MACRO FACTORS
1. SOCIAL FACTORS
OIL Instability, Climate Change, Environmental issues
2. TECHNOLOGICAL FACTORS
Battery Pack
5. POLITICAL FACTORS
Tax Incentives, Energy Loans,
6. LEGAL FACTORS
Carbon Credit Sales, Safety, Emission
3. ECONOMIC FACTORS
Decreased Aluminium costs
7. ETHICAL FACTORS
Environmentally Minded Consumers
8. DEMOGRAPHIC FACTORS
Stagnant, or Negative Growth Rates,& Adoption Rates
4. ENVIRONMENTAL FACTORS
Zero emission laws increase Tesla’s Profits
1
1
3
3
1
5
4
2.5
Weighted Five Scale
Measurement
(Max 5)
24

25. EXTERNAL ANALYSIS
PORTER’S FIVE FORCES
TESLA MOTORS INC
25

26. “Industry structure drives competition and profitability, not whether
an industry produces a product or service, is emerging or mature,
high tech or low tech, regulated or unregulated.”
-Michael E. Porter, “The Five Competitive Forces That Shape Strategy” Harvard Business Review (2008)
PORTER’S FIVE FORCES
EXTERNAL ANALYSIS
26

27. PORTER’S FIVE FORCES
PEV LUXURY SEDAN
EXTERNAL ANALYSIS
Economies of Scale
Network Externalities
Access to Distribution
Raw Materials
Technology and Knowhow
High Elasticity of Demand
Observability of Prices
Industry Growth
Concentration
Switching Cost
Availability of Substitutes
Price Value of Substitutes
Price Elasticity of Demand
Close Complements
Price Value of Complements
Elasticity Demand of Buyers
Relationship Related Trans.
Availability of Substitutes
Volume of Purchase
Importance of Price
Supplier Concentration
Few Input Substitutes
Relationship Specific Invest.
Purchase Volume
Price Discrimination of Sup.
2.17
2.35
3.65
3.48 2.81
Weighted Five Scale
Measurement
(Max 5)
27
Average 2,89
Threat of Entrants
Intensity of Existing Rivalry
Bargaining Power of Suppliers Bargaining Power of BuyersThreats of Substitutes and Complements

28. PORTER’S FIVE FORCES
GENERAL AUTOMOTIVE
INDUSTRY
EXTERNAL ANALYSIS
Economies of Scale
Network Externalities
Retaliation, Toughness
Reputation,Distribution
Access to Raw Materials
Sellers Concentration
Significant Cost Differences
Differentiation
Elasticity
Loyalty
Availability of Substitutes
Price Value of Substitutes
Price Elasticity of Demand
Close Complements
Price Value of Complements
Elasticity Demand of Buyers
Relationship Related Trans.
Availability of Substitutes
Volume of Purchase
Importance of Price
Supplier Concentration
Few Input Substitutes
Relationship Specific Invest.
Purchase Volume
Price Discrimination of Sup.
4.10
4.47
4.38
2.14 3.53
Weighted Five Scale
Measurement
(Max 5)
28
Average 3,72
Threat of Entrants
Intensity of Existing Rivalry
Bargaining Power of Suppliers Bargaining Power of BuyersThreats of Substitutes and Complements

29. PORTER’S FIVE FORCES
MODEL S IN LUXURY
SEDAN INDUSTRY
EXTERNAL ANALYSIS
Economies of Scale in Producing
PEVs,
Government Protection with ZEV
Credits and Energy Loans,
Entry Barriers in Battery and Power-
train Technology
No Direct Competition,
Significant Signs of Growth in the
PEV Market,
Current Manufacturers or Possibly
Start-ups Could Enter in the Future
Internal Combustion Engine Luxury
Sedans,
Internal Combustion Engine
Vehicles,
Public Transportation,
High Oil Prices
Limited Market for PEV Luxury
Sedans,
Fragmented Social Class that can
Afford the Model S,
Customer Loyalty
In-house Protection of S Model
Frame and Power-train,
Contract with Panasonic for
Automotive Lithium-ion Batteries,
Finding Other Partners for Batteries
29
Threat of Entrants
Intensity of Existing Rivalry
Bargaining Power of Suppliers Bargaining Power of BuyersThreats of Substitutes and Complements

30. PORTER’S FIVE FORCES
MODEL S IN INDUSTRY
EXTERNAL ANALYSIS
Economies of Scale in Producing
PEVs,
Government Protection with ZEV
Credits and Energy Loans,
Entry Barriers in Battery and Power-
train Technology
No Direct Competition,
Significant Signs of Growth in the
PEV Market,
Current Manufacturers or Possibly
Start-ups Could Enter in the Future
Internal Combustion Engine Luxury
Sedans,
Internal Combustion Engine
Vehicles,
Public Transportation,
High Oil Prices
Limited Market for PEV Luxury
Sedans,
Fragmented Social Class that can
Afford the Model S,
Customer Loyalty
In-house Protection of S Model
Frame and Power-train,
Contract with Panasonic for
Automotive Lithium-ion Batteries,
Finding Other Partners for Batteries
30
Threat of Entrants
Intensity of Existing Rivalry
Bargaining Power of Suppliers Bargaining Power of BuyersThreats of Substitutes and Complements

31. EXTERNAL TO INTERNAL
EXTERNAL ANALYSIS
31
MACRO ENVIRONMENT
STEEPLED
TASK ENVIRONMENT
PORTER’S FIVE FORCES
INTERNAL ENVIRONMENT
CORE COMPETENCE ANALYSES
TESLA

32. INTERNAL ANALYSIS
TESLA MOTORS INC
32

33. TESLA’S CORE COMPETENCIES
INTERNAL ANALYSIS
Resources
S
* Innovative technology
* battery pack
* Innovative Technology
* Differences, uniqueness
* Technology
* User forum on Tesla website
* CEO Musk
* Openness/ friendliness
of the company / CEO
* Own sales distribution
W
* R&D cost overwhelmed
revenue
* Limited
manufacturing scale
* Limited budget for marketing
activities
* Recent technical issues
* Only available at Tesla
own networks
* Limited distribution
Capabilities
S
* Industry leader as battery
and electric engine
technology
* Cutting edge
manufacturing
* Create unique positive images
* Word of mouth
* Awards
* A lot of publicity of CEO
* Customer satisfaction
* Exclusive services
W
* Only making electric
batteries and engines
* Share the information with
partners
* Production delays
* Technical issues
* Only reaches to limited consumers
* Tesla is responsible for
everything
*Limited external services
R&D MANUFACTURING MARKETING AFTER SALES
33

34. TESLA’S CORE COMPETENCIES
INTERNAL ANALYSIS
34
Generate
Self-reinforcing
Enthusiasm for
the Brand
Create and
Utilize Cutting
Edge Technology
Willing and Able to
Take Risks

35. TESLA’S CORE COMPETENCIES
INTERNAL ANALYSIS
Generate self-
reinforcing
enthusiasm for
the brand
Create and utilize
cutting edge
technology
Willing
and able to take
risks
EXTENDABILITY COMPETITOR DIFFERENTIATION
$
CONSUMER VALUE
TESLA
35

36. CUSTOMER VALUE
Newly categorized products
Customer Service
Tesla Forum
Generate Self-reinforcing Enthusiasm for the Brand
EXTENDABILITY
Publicity
Loyalty
Potential Customers
COMPETITOR DIFFERENTIATION
The first EV Sport car, Luxury Sedan
Own distribution network
CEO, Elon Musk
TESLA’S CORE COMPETENCIES
INTERNAL ANALYSIS
36

37. CUSTOMER VALUE
Pioneers PEV Sport Car and
Luxury Sedan
Safe, Fun Drive experience
EXTENDABILITY
Partnership with Panasonic on
battery cells
OEM for Daimler and Toyota
COMPETITOR DIFFERENTIATION
Pioneer EV Sport car, Luxury Sedan
Competitive position in the EV market
Create and Utilize Cutting Edge Technology
TESLA’S CORE COMPETENCIES
INTERNAL ANALYSIS
37

38. CUSTOMER VALUE
Newly categorised products
Partnership with Panasonic
EXTENDABILITY
Publicity
CEO Musk’s Capabilities to EV industry
Wealth individuals to mass market
COMPETITOR DIFFERENTIATION
Take challenges to create new
values in the industry
Willing and Able to Take Risks
TESLA’S CORE COMPETENCIES
INTERNAL ANALYSIS
38

39. Evaluation of Tesla’s
Core Competence
TESLA MOTORS INC
39

40. EVALUATION OF CORE COMPETENCES
REMARKS
Being “willing and able to take risks”
allowed Tesla to find its position in the
market, and more importantly, force
others to take notice. Infrastructure
investment shows this, and is supported
by their vision.
“Generate self-reinforcing enthusiasm for
the brand” has helped Tesla focus on R&D
through better resource allocation. This
overcomes limitations in the external
environment related to potential
substitutes and larger budgets of
competitors.
Tesla’s use of “cutting edge technology from
top to bottom” is a sign of commitment
related to the values of Elon Musk and helps
them succeed. “Unintended?” benefit of
technological laws, Moore’s etc.
40

41. FUTURE CHALLENGES
TESLA MOTORS INC
41

42. FUTURE CHALLENGES
FUTURE
CHANGE AND RESISTANCE
Large firms are
slowly adapting
Tesla’s sales
platform has found
resistance
How does “buzz”
apply to products
for the broader
market?
42

43. 43
40
80
120
160
200
Jan 10 Mar 13 Sep 13
Maximum
193,37
Battery Case Later
StockValue Ontrackforsuccess
Decline/Failuretogrow
Internal&Externaliscorrect;Teslaexpandstothegeneralmarket
Internal&Externalisincorrect;thelargerenvironmentturns
Stagnation
InternalorExternalisincorrect;Teslastruggles
FUTURE CHALLENGES
FUTURE

44. Don’t underestimate the value of a vision1
Starting with a niche and expanding is viable2
Some external environments, despite initial assumptions, provide opportunities3
If you provide an exciting product, especially a premium product,
consumers will generate buzz themselves
4
Products are quickly becoming more “technological”, and managers should account for this5
EVALUATION OF CORE COMPETENCES
LESSONS
44

45. THANK
YOU
For your attention!
45