CURRENT STRATEGY OF TESLA

Posted: March 26th, 2020

CURRENT STRATEGY OF TESLA

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Current Strategy of Tesla

Tesla is a vehicle manufacturing company that designs and manufactures electric cars and other battery products. It is known for it Model S sedan, with projections of Models X and 3 in future[1]. Tesla products target the high-end markets with affluent buyers. For the first time in history, Tesla recorded its first profits in 2013.

Tesla’s current strategy is to be implemented in three steps. The first strategy was to build the Tesla Roadster, which costs approximately $109,000. The revenues generated form the sales of this model would be used in the production of the Model S, which is mid priced, with a low volume. The model S is priced at $57,400. The company aims to produce the third car, Model X, a family size sport utility vehicle, which will be priced at approximately $35,000. This strategy involved the introduction of high quality and expensive products into a market, then gradually reducing the prices of the subsequent products as more are introduced into the market.

The company’s goal is to increase the numbers and varieties of their products into the market. Their current strategy, to introduce newer and cheaper models in the market is effective. This keeps prospective customers on the look out for new models, anticipating new features and improvements. In order to achieve this goal, Tesla sells its own vehicles in only company-owned showrooms and over the internet. This is to ensure that customer’s trust for the product remains. Tesla also sells its power train components to different automakers in the market. This broadens their customer base and market scope. The company strives to serve as a good example to other automobile makers in the industry. The concept of electrical vehicles gives the company an edge over others, as it is environmentally sensitive.

Bibliography

Doeden, Matt. Spacex And Tesla Motors Engineer Elon Musk, n.d.

[1] Matt Doeden, Spacex And Tesla Motors Engineer Elon Musk, n.d.