Strategy Making
Based on case no. 7 Tesla Motors’s Strategy to Revolutionise the Global Automotive Industry, page 333 of the Textbook.
Tesla Motors’ CEO Elon Musk has employed you as a consultant to assess the company’s overall situation and recommend a set of actions to improve the company’s future prospects. Please prepare a report to Mr. Musk that includes:
(1) the pros and cons of Tesla Motors’ strategy,
(2) an evaluation of Tesla’s financial performance as shown in case Exhibit 1,
(3) an assessment of whether the information in case Exhibit 2 is valuable or misleading, and
(4) your outlook for Tesla’s future performance and its prospects for revolutionizing the global automotive industry’s use of gasoline-powered engines versus battery-powered engines
1. What are the key elements of Tesla Motors’ strategy?
2. Which one of the five generic competitive strategies discussed in Chapter 5 most closely approximates the competitive approach that Tesla is employing?
3. Are you impressed by the strategy Elon Musk has crafted for Tesla? Why or why not?
4. What is your assessment of Tesla’s financial performance as shown in case Exhibit 1? Use the financial ratios in the Appendix of the text in calculating a revealing set of financial ratios and interpreting them.
5. What do we learn from the data in case Exhibit 2? Does the data provide additional valuable information? Why or why not?
6. What grade would you give Elon Musk for his handling of the battery pack fires and battery-charging fire in the residential garage of a Model S owner?
7. What are the issues/problems that Elon Musk and other members of Tesla’s top management team need to address?
8. What, if any, changes/adjustments in Tesla’s strategy would you recommend that Elon Musk consider?
9. What is your outlook for Tesla’s future performance and its prospects for revolutionizing the global automotive industry’s use of gasoline-powered engines versus battery-powered engines?
