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- 1. Group members: CHEN LIYUAN 5921489 LIU TIANCHANG 5973422 LI RUOYU 5921364 XIE JIALIANG 5916924 MAI NGAN PHAM 5971255 CAO WENBO 5931411 LI YANG 5915042
- 3. Industry and company overview 1.USA company, established in 2003 2. Provide electric vehicles and technical support 3. Current target customers is upper-middle class Tesla Company 1. New industry - High cost of battery - Require Charging stations 2. Support from the States 3. Main competitors: BMV, Nissan, BYD Electric Cars Industry
- 4. Long-term Strategies Source: Tesla Blog Step 1 • Produce high-end products for the niche market, build reputation and make the brand well- known. Step 2 • Produce mid-priced cars to attract more customers Step 3 • Produce economically priced cars in mass production
- 5. Why Moving? Market saturation in USA Cheaper petrol price in USA (0.83 US Dollar per liter) Potential markets in emerging countries USA India China Australia Morocco Poland UK Liter,US Dollar 0.8 1.01 1.17 1.19 1.43 1.47 1.91 Liter,USDollar Gasoline Prices 2014-December
- 6. Factors to consider Volume of Sales Market characteristics Incentives from Government Infrastructure
- 7. Options Norway • Generous incentive system • 3rd largest market of Tesla • Tiny population ( 5 mil) • Remote, mountainous location • Tesla factory in Holland China • Largest luxury vehicle market, 2nd in Tesla sales • Expanding middle class • The Government’s support • Large population • Lacks of infrastructure • Fierce competition • Government bias
- 8. Business environment in China Featur es • Large demand for cars • Relativel stable and balance market • Government control Advantages • Stable environment • Growing market economy • Acceptable market potential Disadvantages • Cultural differences (guanxi, face) • Lack of support from Chinese government
- 9. SWOT analysis 1. More cost-effective than traditional cars 2.Free charging network construction for Tesla user 3. Online customer experience 4.Advertisment 1.Cost and price 2. The electric field has not been developed 3. Increasing selling expenses 1. Huge demand in China 2. Environment protect awareness 3. Cheaper labor cost 4. Culture (face) 1. Competition 2. Land resources 3. Chinese policy support issues 4. Trademark right problem Threats Weaknesses Opportunities Strengths
- 10. Entry Strategy In China Set up local partnership to build a Chinese plant for local production (Changan Automobile Group) Build charging stations across the country Produce both high-priced and medium-priced products
- 13. Car per capita saturation in USA Source from : (Dargay, 2007)
- 14. Tesla's selling Expenses 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2013 Q2 2013 Q3 2013 Q4 Thousand US Dollars 30,582 36,083 37,798 45,908 47,045 59,963 77,071 101,489 ThousandUSDollars Tesla's selling Expenses Source from: Tesla annual financial statem Internal problem ( working affiance, etc) External problem (resources fees etc.) Logistics costs ( American to China)
- 16. Changan Automobile Group Chinese state-owned automotive manufacturing company One of the “Big Four” Chinese automakers 18 production bases throughout China Introduced a hybrid automobile in 2007
- 17. Reference List Dargay, J. (2007) Vehicle Ownership and Income Growth, Worldwide: 1960-2030. University of Leeds: Institute for Transport Studies TESLA MOTORS, INC. ANNUAL REPORT. (2013). Tesla motors, inc. annual report on form 10-k for the year ended December 31, 2013. Washington, D.C. UNITED STATES: UNITED STATES SECURITIES AND EXCHANGE COMMISSION. global petrol prices (2014) Global Petrol Prices [online] available from <http://www.globalpetrolprices.com/gasoline_prices/ > [11/26 2014]