Under the leadership of Elon Musk, the company is planning to keep itself ahead of its competitors.
CEO Elon Musk has made a habit of making the rivals sweat with his strategies and innovational productions. Tesla revealed about the business practices which every industry must recognize.
The company has spread an analysis showing, how in the year 2015, its Model S sales have outperformed the sales of other luxury sedans. The company’s Model S sale stood at the top with 21,934 units sold last year. The second in line was the prestigious Mercedes S-Class, whose 21,934 units managed to be sold in the market. All of the nine listed competitors of the automobile giant underwent a significant decline –in double digit percentages –in sales of their products last year. In comparison with the company’s declining sales, Tesla’s sales increased by 51% –credited to the car maker’s efficient production.
However, the above mentioned comparison may not be made on the plausible grounds. For instance, Mercedes retail price is $95,000 while Tesla Model S starting price is $70,000. But, it cannot be ignored that last year Tesla outperformed in the sales of Audi A7 which falls in the same price zone.
With just a young age of 13 years, the automobile giant has spread its wings in the big competitive market. According to Tesla, the automobile industry is the most difficult one for the outsider to intrude. The chief reason is the humungous capital requirements. Moreover, the established global giants had their presence all over the market therefore the entry of a new company is not free from risks. However, Tesla blazed the trail for the high tech embedded luxury electric cars and gradually it has become the strong competitor in the relevant industry. The $21 billion organization went against the traditional ways and eliminated the dealerships altogether. If a strong industry like an automobile’s can be hugely effected by the new entrant then any other industry can have the similar results.
Moreover, the introduced technology is relatively new and a lot of established competitors have not texted their expertise in the high tech segment. As the years pass by, Tesla’s products are getting better and better and most importantly they are not being available in affordable rates. Recently, few rivals have geared up to get ahead in the race. However, Tesla’s vast knowledge and higher volume production will help it to avoid lagging behind.
Far ahead than profitability, a company’s mission is to satisfy its customers. The customers of the company include both employees and the customers and Tesla doesn’t lag behind in motivating and attracting employees and tempting the consumers to go for its products.
However, Tesla does get an Achilles heel after all. The company’s cash burn is increasing at an alarming rate. Last year, it struggled to keep up with its production capacity. If the competitors manage to manufacture the electric cars at the same rate as they make the old conventional ones then Tesla might get a run for their money.
Moreover, Tesla has already disclosed its plans for the coming year. The year 2017 holds fair outlook for the company. The San Carlos, Calif. firm is gearing up to produce and deliver the highly-anticipated Model 3 on time. To meet the deadline, the company has a lot of work to do and it is indeed meeting its target.
The essential step which the car maker has taken is the establishment of Gigafactory which reportedly will assist the company to meet its target of manufacturing 500,000 cars by 2020. Through the factory, the automobile organization will be able to lower its cost of lithium batteries that are currently used in the cars.
Tesla also disclosed about the $1.5 billion investment for installation of machineries purporting to the production of Model 3. Initially, the Fremont, Calif. factory will be used for the production of the new car. Moreover, Musk has been reported to have said that for the Chinese market, the company is also in favor of producing Tesla cars in China. The company’s official website reports that at the present the factory is capable of manufacturing 100,000 vehicles therefore the probable investment will result in robust production.
For showcasing their production, the car maker is planning on to set up 80 new retail locations and service centers. Currently, Tesla has to its credit 140 retail and service stations. However, the automobile behemoth wants to expand the retail locations so that the big number of vehicles to be produced in the future can easily be accommodated.
Moreover, the “fuel” of the electric cars, “the superchargers” will also be expanded; according to company’s future plans. With Model 3 around the corner the company has to take up the current 597 Superchargers with almost 3,481 superchargers.
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