While Model 3 is the most affordable car made by Tesla, it is still out of reach for many middle-class consumers. It would ease the tension of competition. This aspect of the SWOT analysis of Tesla Inc. deals with the business strengths that contribute to organizational growth and improvement. Its increasing with the advancement of technology, and alternative fuels such as shell gas, CNG, etc. However, the pandemic also seems to have pushed the demand for EVs higher, which was evident in the growth of Tesla car sales during the third quarter of 2020. In the SWOT analysis model, this vertical integration helps reduce risks linked to third-party unpredictability. Brand recognition helps the company to introduce new products to the market more easily and with fewer costs. If the company wants to increase its footprint in the existing and new markets, it will need to grow its supercharger network in all the markets. In this article, we will merge both SWOT and AHP to determine the criteria, subcriteria, and the best strategies of EV business in Bangladesh. The internal and external factors are summarized In the last few months only, Tesla stocks have climbed insanely and steadily. According to a SWOT analysis of the automobile industry, Toyota, Ford, Volkswagen, Honda, Nissan, General Motors, Hyundai, Kia, and BMW are the main rivals. For 2019, its operating expenses stood at $4.14 billion compared to $4.4 billion in 2018. Strengths Global presence: Ford is a truly global brand with a strong global footprint. collaborating on marketing and promotion, sales of vehicles, production, research and development, and De Graaf, F. J., & Wilderom, C. P. (2020). The food acidulants market is valued at US$ 2.6 billion in 2023 and is estimated to reach a value of US$ 4.5 billion by 2033, registering a CAGR of 5.4% during the forecast period. Tesla, Inc. (formerly Tesla Motors, Inc.) succeeds as an innovative business with global operations. Power of bargaining: With the increasing market, competition between companies is increasing rapidly. The Tesla brand is a symbol of innovation and sustainability in line with Elon Musks business goals. In 2019, the company delivered around 3,67000 units, which was a sharp rise from around 2,45000 in 2018. [1], Figure 1. With this SWOT analysis, each of the Automobile Industrys strengths, weaknesses, possibilities, and threats on the market was emphasized by their company. The company operates 4 different brands: Daihatsu, Hino, Lexus and Toyota. Diversify its supply chain to reduce supply-side risks. Two limitations of the PESTEL tool acknowledged by Krol (2020) were that it is mainly a qualitative process that does not have underlying quantitative support and, as This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s. Unlike the other cars on the roads, these cars rely on Teslas own charging infrastructure, without which they cannot play on the roads. Still, the overall valuation of the company has grown much higher than its rivals. Volatility in the fuel prices: For the consumer segment, fluctuations in the fuel prices remains the determining factor for growth. It brings both direct and indirect employment which directly connects with economic development. Such insights can inform and guide corporate governance and management to ensure the growth of the automotive business. OEM (original equipment manufacturer) should consider working with experts and manufacturers of the other industries. Its supercharger network supports its sales of cars in all the leading markets. Changing lifestyle & customer groups: As the whole world is going through huge economic development, change in lifestyle is becoming more prominent. As it is a large industry worldwide, here is an Automobile Industry SWOT analysis describing its strengths, weaknesses, opportunities, and threats. The company has earned over 60% of its revenue from the U.S. alone. Its total sales for the third quarter of 2020 were around 40% higher than the sales during the same period in the previous year. Top of line Industries like Automobile Industries additionally have a few shortcomings and imperfections, and they prevent the companys development to some extent. Its model S can drive roughly 370 miles without stopping for a charge. With the goal of improving business competitiveness, growth, and development, this SWOT analysis shows a number of ways that Tesla can use to enhance its performance. The emerging markets like India and Brazil present significant growth opportunities for the EV brand. As one of the most reputed production genres, Automobile Industry has some solid strengths: Growing Industry: Across the world, auto is a synonym for development. Industry experts have stated that growing digitalization and advancements in technology will increase the automotive industrys investments to $82 billion by 2020. Public transport, bikes, vehicles, and cars fall under the category of automobiles, and they play a significant role in the development of any society along with the transport infrastructure. SWOT analysis gives the internal and external factors used to make a systematic decision for the future. Perceiving the chances that line up with the companys development is a huge piece of its essential arranging. The intense competition is forcing companies to expand their market and enter into developing countries. Also, government regulations pertaining to the use of alternative fuels like CNG and Shell gas is also affecting the inventories. [8], The company received more 2017 J.D. Which is also making new increasing demand for luxury public transportation systems. Automotive brand ranking by Interbrand. It allows people an unimaginable lifestyle with luxury, freedom, and travel. This opportunity is based on the economic growth of countries where the companys electric vehicles have limited market presence, which is one of the weaknesses examined in this SWOT analysis. Tesla, Inc. has the strengths to remain successful in the business in the years to come. Since they have a few number focuses, it is simple for them to think about the chances. By 2025, EVs' global market is projected to grow to above $567 billion, which is an attractive opportunity for Tesla. Toyota Motor Corporation was incorporated in 1937 and since then, has become one of the most recognizable brands in the world. While this will help the company grow its presence and create more demand, it will also help it beat other brands' competitive pressure. These cars' maintenance costs are very low because of the lower number of parts used inside them, which more than makes up for the one-time purchasing costs. To maintain resilience despite changing industry conditions, Tesla needs to address the following threats relevant to this SWOT analysis: Automotive companies aggressively compete against each other. Microsoft Corporation SWOT Analysis (2016), Zora Neale Hurstons Their Eyes were watching God: Analysis. The declining economic conditions have made it even more difficult for companies to survive. Both Honda and Nissan are well-known in the US, Europe, and Asia. This external factor involves establishing or acquiring new businesses with operations outside the companys current business of electric automobiles, batteries, and solar energy products. Stay up-to-date with the latest business and accountancy news: Sign up for daily news alerts. This is more than 50% higher than the range that competing cars from brands like Chevrolet, Nissan, or Jaguar offer. Furthermore, other markets are also likely to emerge soon. In fiscal 2019, the net loss of the company was $862 million compared to $976 million in 2018 and $1,962 million in 2017. It provides you an opportunity to perform multiple tasks with one vehicle that werent possible in the past. Published: January 10, 2021Format: PDF + PowerPointPages: 25Words: 5,000Charts/tables: 12, Email: [email protected]. This weakness relates to the objective of maintaining a premium brand image despite strategies that aim for the widespread use of Tesla cars. The industry is already going through such difficulties as covid-19 bringing vehicles to minimize mobility. Growth through diversification is another opportunity relevant to this SWOT analysis of Tesla Inc. Toyota, which produced and sold 8.964 million vehicles in 190 countries in 2018 alone, has one of the widest consumer reach in the world. Their cars can make up to 240 miles at best on a single charge, which is nothing compared to Teslas Model S. It marks a major difference for Tesla and is also the primary reason behind the superior demand for its SUVs. The company can: We use cookies for website functionality and to combat advertising fraud. For the past several years, these countries have seen impressive economic growth. For CCPA and GDPR compliance, we do not use personally identifiable information to serve ads in California, the EU, and the EEA. The future is full of opportunities for Tesla, and the company must see a sharp growth in profitability in the coming years. Tesla is a sustainable brand that makes fully electric cars. This industry is also contributing to job creation and skill development. When expanded it provides a list of search options that will switch the search inputs to match the current selection. These factors are threats that prevent the automaker from maximizing the benefits of its strengths and opportunities. While the company has produced excellent results until now and is known as a highly innovative automobile company, it should maintain a consistent focus on innovation in the future and remain ahead of the competitors worldwide. Tesla has established supercharger stations along well-traveled routes in the key areas where its products sell. It has also increased the sales of cars and vehicles and the growth in the industry is good for the business. As more countries are open to the automobile industry the market will keep on expanding and developing. In relation, this SWOT analysis determines that Teslas limited access to innovative supplies is a weakness that prevents the company from rapidly expanding internationally. Some of the threats are listed below: Intense Competition in the market: The more companies are investing in the Automobile industry the more competitive the market is becoming. It has resulted from the companys consistent focus on technological innovation over time. According to Interbrand[5] and Forbes[6], Toyotas brand is the worlds 7th and 9th most valuable brand worth US$50.291 billion and US$44.7 billion, accordingly. Yet it is undoubtedly a symbol of progress and innovation, despite the negative factors. The impact of the pandemic on the automobile industry has been the severest. Source: Ford SWOT analysis [3] (*data for Toyota is for the whole North America segment, which includes U.S., Canada and Mexico) U.S. is the second largest automotive market in the world and is the largest GMs market in terms of revenue. Also, government regulations pertaining to the use of alternative fuels like CNG and Shell gas is also affecting the inventories. All Rights Reserved. The method is often used at the start of or as part of a strategic planning exercise. And this expansion may continue in other countries. India's Automotive Market was valued at USD 100 billion in 2021 and is expected to reach USD 160 billion in 2027, registering a CAGR of 8.1% over the forecast period (2022-2027). The ecological and sociocultural trends in the industry environment matches the diversification opportunity identified in this SWOT analysis. In the third quarter, demand has started picking up, but for the impact of the pandemic to fully go, it will take some time. In todays globalized economy, outsourcing has become an integral part of business operations. Lets look at them: Efficiency: with the development of technology people are becoming more careful about efficiency levels. How Tesla created advantages in the EV automotive paradigm, through an integrated business model of value capture and value creation. Expand internationally and work to secure worldwide production. Over recent years, there have been various industry developments that served as or caused trends in procurement. There are other types of regulatory pressures on automobile brands. Korean automakers Hyundai and Kia are both present in the US, Europe, and Asia. The company has established 1971 supercharger stations with 17,467 superchargers. Government regulations: Regulations like excise duty, no entry of outside vehicles in the state, decreasing number of the validity of registration period, and volatility in the fuel prices pose considerable challenges to automobile companies. The automobile brands should keep these challenges in mind before taking any corporate decision. These external strategic factors are opportunities that Tesla can use to improve its business performance, management effectiveness, and strategic growth. Full-year sales in the world's biggest auto market fell 1.9% to 25.3 million vehicles in 2020, the data showed. Its no doubt Western and European markets are the main pulse of the automobile industry. Other than that, hes a fun loving person. The increase R & D cost is decreasing companies profitability. As one of the largest This brings benefits for customers but makes it hard to get a good profit for the companies. They are trying to emerge in the market by building facilities. These are ideal conditions for an emerging market. Lang, J. W., Reber, B., & Aldori, H. (2021). While Tesla is enjoying the lions share in the US and China EV markets, the competitive pressure on the company will continue to grow. This could bring out benefits from the difficult competitive market. The internal factors that limit organizational performance are identified in this aspect of the SWOT analysis of Tesla Inc. The industry is also trying to use renewable sources of energy such as solar, wind, and others. The SWOT analysis model views this internal strategic factor a strength that empowers the company to develop competitive and profitable products for the electric car market. It is priced high and out of the price range of the average consumer. New or additional sales operations in high-growth countries can enhance business growth to satisfy Teslas corporate mission statement and corporate vision statement. Puyt, R., Lie, F. B., De Graaf, F. J., & Wilderom, C. P. (2020). We have dissected the SWOT analysis for companies in the automobile industry below: Evolving industry: The automobile industry is a highly growing industry, continuously contributing to growth and development. Automobiles give people the opportunity to live, work and travel in ways that were unimaginable a few decades ago. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); About - Privacy Policy - Returns and Refund Policy. 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