Tesla and its flamboyant, and sometimes erratic, innovator Elon Musk have turned the more than a century old industry upside down in a mere 16 years. Traditional automakers are ill prepared to compete in today’s software-centered world. Unlike nimble Tesla, they are big, bureaucratic, slow to respond to customers, dependent on providing customer financing for unit sales growth, and culturally different from a software company. Tesla’s speed in innovation in the market for high-end vehicles is more like a Google or an Amazon than an automaker. And its soaring market valuation is a clear sign to all automakers that they’ll need to develop more innovative, Tesla-like business models in order to survive.â€™
Harvard Business Review. February 28, 2020
As per your Textbook –
â€˜Tesla’s cars had rapidly attracted a large and loyal fan base, and sales were growing at an impressive rate. However, designing and launching multiple major car platforms while building a large-scale battery company, a network of charging stations, and operating Solar City was a lot for a company to take on in its first fifteen years. This left some analysts scratching their heads. Was Tesla trying to do too much too quickly?â€™
Students are requested to read Chapter 6 Defining the Organizationâ€™s Strategic Direction of their textbooks. With the conceptual knowledge from Chapter 6 and your own research, answer the following questions.
Q1- How would you characterize competition in the Auto Industry? (250 -300 words)
Q2- What do you think are Teslaâ€™s core competencies? Does it have any sources of sustainable competitive advantage? (350 -500 words)
Q3- What do you think Teslaâ€™s (or Elon Muskâ€™s) strategic intent is? (350 -500 words)