The companys goal on being ahead of its competition by introducing some of the most innovative vehicles in the market has proven to be a successful strategy. Teslas strategic management must overcome the following weaknesses relevant to this SWOT analysis: Tesla Inc. suffers from limited market presence. The SWOT challenge the automotive industry. Recent events in the international politics has slowed down global economic activity. WebTo calculate the market size, revenue from the market sales of Passenger cars, light commercial vehicles and heavy commercial vehicles are considered. [9] In addition to the awards for its vehicles, the company ranks the 2nd on the Carbon Clean 200 List, which ranks the companies according to their efforts to transition to clean energy.[10]. As more countries are open to the automobile industry the market will keep on expanding and developing. New or additional sales operations in high-growth countries can enhance business growth to satisfy Teslas corporate mission statement and corporate vision statement. The usage of technology and digitalization have made people leisure and comfortable. The case of the solar roofs Tesla had promised is also similar. Changing lifestyle & customer groups: The increased availability of data and information, shift in consumer demand, and expanded regulatory requirements for safety and fuel economy will fuel the growth of this industry. Governments around the world are allowing subsidies to the brands that make fully electric vehicles. These cars use fewer parts overall compared to a regular car due to which the maintenance costs for the owner and technical complications are also lower. 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. The automobile industry is a matter of creating and selling self-fueled vehicles, including traveler vehicles, trucks, and other business vehicles. [7], In 2018 alone, the company has received 7 IIHS (Insurance Institute for Highway Safety) Top Safety Picks 2018 awards (more than any other automotive company) for its Toyota Corolla, Prius, Camry, Avalon, Highlander and RAV4 vehicle models as well as 4 other Top Safety awards for Lexus models. This aspect of the SWOT analysis of Tesla Inc. deals with the business strengths that contribute to organizational growth and improvement. Its total sales for the third quarter of 2020 were around 40% higher than the sales during the same period in the previous year. SpendEdge, established in 2003, is one of the worlds leading procurement market intelligence companies. The research on renewable energy sources continues and increases. To sum up, in sustainability and innovation, Automobile Industry is an established pioneer. The impact of new firms is considered in this aspect of the Five Forces analysis. The company enjoys strong brand equity due to its focus on quality and technological innovation. It makes only Electrical vehicles and that too for the higher end market. Latest Updates China category Hong Kong police While the US and China are the leading markets for Tesla cars, its presence worldwide is limited compared to the other leading automobile brands. Tesla has established supercharger stations along well-traveled routes in the key areas where its products sell. Power Vehicle Dependability Awards than any other brand. Fords SWOT analysis shows the They are trying to emerge in the market by building facilities. SWOT analysis gives the internal and external factors used to make a systematic decision for the future. The automobile industry symbolizes economic growth and freedom. These factors also affect the growth of the industry. Work to create consumer confidence and build long-term trust in the company. While according to the CEO, the company is planning to release additional services like Robotaxis, faster future growth of the company depends on its focus on innovation. 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. In the SWOT analysis framework, high prices prevent Tesla from rapidly growing its customer base and market share. Top of line Industries like Automobile Industries additionally have a few shortcomings and imperfections, and they prevent the companys development to some extent. Thats why many brands are shifting their attention because of the better economic condition, changing lifestyles, and more disposable income. While Tesla has emerged as a comparatively resilient company during the pandemic, its sales declined during the first two quarters of the year compared to the previous year caused by the pandemic. It limits the companys customer base considerably against the other brands. Automotive companies have to spend a plethora of resources in research and development annually in order to stay in the game. However, in the third quarter of 2020, the company has experienced impressive sales growth. R & D has become a necessity for them because they cant launch new features and models without it. As supply chains become increasingly complex, procurement has become highly crucial and influential in the production process and continues to grow. Review our Save my name and email in this browser for the next time I comment. The market valuation of Tesla has grown very fast in recent years. Tesla cars are made mainly for the higher end of the market. Furthermore, other markets are also likely to emerge soon. SWOT analysis applications: An integrative literature review. This strategic factor is based on the hierarchy aspect of Teslas organizational structure that facilitates centralized control of the corporation. However, while Tesla continues to grow its foothold in the leading automobile markets stronger, there are also some challenges ahead. The company also faces the threat of dealership regulations. Its focus on technological innovation has mainly driven tesla's growth. These factors are threats that prevent the automaker from maximizing the benefits of its strengths and opportunities. This is more than 50% higher than the range that competing cars from brands like Chevrolet, Nissan, or Jaguar offer. These nations have cheap workforce, are high in resources, and are nearer to developed economies. It impacts customers directly and theyre very cautious about their daily expenses. 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). Automobile Industry swot analysis offers the brightest part of the opportunities offered by the Automobile Industry. Still, considering that the automobile industry is passing through a challenging phase, Teslas performance counts as nothing less than rock solid. Other automobile businesses are also aggressively pursuing an EV strategy since the demand for EVs has grown worldwide and is expected to grow faster after the pandemic. Teslas corporate social responsibility strategy and stakeholder management efforts that capitalize on the sustainability trend can help facilitate sales expansion and supply chain expansion. As one of the largest Samsung SWOT Analysis 2023: A Fierce Rivalry Detailed Report! Other factors that have led to increasing EV demand worldwide include government subsidies and the zero environmental impact of these cars. But this investment needs to be profited out which is a big challenge. 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 One significant competitor has emerged in the form of Polestar. So, while Tesla sales may have jumped in the third quarter of 2020, once sales again start picking up post-pandemic, shipments from other brands will also grow. The ease and quality of life improvements the automotive industry brings will only increase the demand for vehicles in the future. However, limited global operations remain a weakness that, along with other issues identified in this SWOT analysis, Tesla Inc. must address to maintain international competitiveness and corresponding business growth and expansion. According to sources, Tesla sold more than 64,000 units in the US in the third quarter of 2020 compared to around 52,000 units during the same period in the previous year. In August 2019, there was a 35.9 per cent drop in domestic sales for market leader Maruti Suzuki with 94,728 units being sold due to subdued market confidence, slow economic growth and crisis in the non-banking financial companies (NBFCs). While Tesla has currently maintained its lead in the EV market, it is predicted that the company could lose its lead to VW, Renault, Nissan-Mitsubishi alliance, and Chinas Geely by 2025. All Rights Reserved. For example, when it unveiled semi-trucks in 2017, the company had promised that they will be available by 2019. Some of the main brands in the automobile industry are; Today, well discuss the swot analysis of the automobile industry. Tesla is the leading EV brand in the world. To grasp the competitive environment of the industry better, it is possible to examine the distinct strengths and weaknesses that each of these businesses brings. In the US, while Teslas overall share in the automotive market is only 1.3 percent, its share of the EV market has grown to above 60%. Such insights can inform and guide corporate governance and management to ensure the growth of the automotive business. Changing lifestyle & customer groups: As the whole world is going through huge economic development, change in lifestyle is becoming more prominent. The value of SWOT examination is frequently reliant on the target understanding of those administration people who lead the SWOT investigation. These external strategic factors are opportunities that Tesla can use to improve its business performance, management effectiveness, and strategic growth. For example, the company generates most of its revenues in the United States and has relatively limited operations in other electric car markets. Tesla has also partnered with various other businesses including Hilton Hotels to establish its destination charger network throughout the United States and other markets. In the automobile industry, technological innovation can be a major source of differentiation and faster growth. While the pandemic might have affected the economic performance of these regions, the higher end market has mostly remained less affected as compared to the lower end. The March 2020 numbers show the effect of lockdown due to the COVID-19 pandemic. 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 Quezada, L. E., Reinao, E. A., Palominos, P. I., & Oddershede, A. M. (2019). ICAEW.com works better with JavaScript enabled. Our May and November analyses are below. Over the last few months, the auto industry has shown tremendous resilience. From the economic depths experienced in spring 2020, it has rebounded to deliver year-over-year growth in new-vehicle sales over the last few months across China, Europe, and the US. 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. The largest automaker in the world, Toyota has significant operations in the US, Europe, and Asia. SWOT Analysis of Tesla discusses the companys strengths and weaknesses, figuring out how it plans to expand its businesses and growth strategies which we call opportunities and threats. The company will need to expand its production capacity to meet popular demand. 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