Pestel: Electric Vehicle and Tesla Motors

Topics: Electric vehicle, Electric car, Tesla Motors Pages: 3 (802 words) Published: March 25, 2012
Case 5 Tesla Motors and U.S. Auto Industry
As a pioneer of green technology car manufactory, Tesla Motors has placed himself in the U.S. automotive industry. Tesla Roadster is considered to be a cash cow in 2009, and it is the only electric cars have been mass product. However, after the competitors had entered the market, alternatives joined the battle of green technology car, such as hybrids, fuel cell ,etc. Furthermore external environment has changed. Elon Musk, the co-founder and head of product design, is facing a question either to sell it or continue to run three companies including Tesla Motors at once.

Base on my opinion, in order to analyze Tesla Motors' case, external environment analysis on electric car industry should be done first, due to the factor that it will provide a better understanding of threats and opportunities that Tesla Motors may have in the future operation. The Pestel Framework

1. Political Factors
* Federal tax credit of up to $7500 for qualified plug-in electric drive vehicles. * Received $465 million loan from the U.S. Department of Energy in June 2009. (C 47) * U.S. government supported investments of $1.3 billion in hydrogen-powered-vehicle research. (C 41)

It is obvious that government is willing to encourage both to apply green technology on auto industry and to increase consumption by add tax credit for electric drive vehicles. 2. Economic Factors

* Economic crisis 2008.
* Gasoline price has more than doubled since 1995 in U.S. * Bankruptcy of GM and Chrysler and extremely perishing influence on Ford.
Economic crisis aggravated financial pressure globally which is a definitely negative effect on luxury industry, include in Tesla Motors. $100,000 per unit had kept plenty of potential customers away, and the crisis makes it even worst. However, from personal experience. in China, actually there some people are getting richer even under the strike of financial depression. If Tesla could...
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