Tesla Analysis

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Executive Brief for Tesla Motors Inc.

To: Elon Musk, CEO of Tesla Motors, Inc. From: Yuan Gao (kiki) Re: Strategic Improvements for Current Situation Date: 5th Aug, 2012

Executive Summary

Tesla Motors is a relatively new Silicon-Valley based company that designs and produces electronic vehicles. The company aims at producing consumer affordable price electronic automobiles with zero emissions in the next decade. Currently the CEO Musk is working on introducing the new electronic automobile Model S to the mass consumer market. However, when we look at the external environment, the Tesla Company still faces lots of challenges. The Tesla Motors’ strong competitors are the automobile companies that produce gas cars such as Toyota, Honda and Ford. In order to further expand the market share of the electronic automobiles, it is necessary for the Tesla Motors to improve the company’s efficiency in terms of their financial, management, logistics and marketing strategies. Therefore, we should find a way to change the strategies and better adjust to the current market.

Balanced Scorecard for Tesla Motors | Objectives| Measures| Targets| Initiatives|
Financial| Increase net income| Market share| Increase by 15%| Improve foreign market shares| | Return on sales| Profit/Sales| Increase by 10% yearly| Reduce the cost| | Contribution margin| Price- variable cost/price| Increase by 5%| Reduce the cost| Customer| Lower the price, Improve the customer service| Customers’ feedback, Market research| Further penetrate the US market and broaden foreign market| Improve market share in both the US market and foreign market| Internal| Employee satisfaction| Surveys results| 90% satisfaction| Communication program| | Improve factory environment | Compare to the environmental standard| Reach the environmental standard| Improve product quality| | Improve production efficiency| Numbers of production| Increase by 20%| Increase numbers of production by 20%| Learning| Improve the cooperation with Toyota and GM| Total sales| Increase 15% compare to the last year| Cost reduction Programs.|

Opportunities to Create Value Through implementing new strategies

Strategic Area:| Opportunities to Create Value:| Challenges to Create Value:| Finance| * Decrease the amount of loan * Improve the efficiency of investors’ capital * Reduce the spending on manufactures | * Relatively low sales * Low market shares * Not clearly about the waste of spending * Cost for manufacture is too high| Marketing| * Increase the budget of advertising * Create marketing campaign both in the US and foreign countries * Offer promotion to early adopters| * Lack of budget on marketing * Low awareness of the brand * Economics factors | Logistics| * Strengthen usage of the factory space * Make policies of factory environment to make sure the production process * Decrease the cost of production process * Improve internal communication * Consolidate the cooperation with Toyota and GM| * Hard to smaller factory space in a short time * Difficult to create economics of scale * Uncertainty of external factors | Management| * Improve the employee benefits * Create the opportunities for employees to get promoted * Improve employees’ salaries * Make specific company policies * Reinforce the internal communication efficiency| * Too much spending on research and technology * Have to laid off the employees due to cost problems |
Opportunity Overview Currently, the environmental issue becomes one of the main topics for every company. For Tesla Motors, the biggest opportunity is that there is a trend that...
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