Tesla Motors Company Launching of Model X - Coursework Example

Tesla Motors Company, Launching Of Model X Tesla Motors Company, Launching Of Model X Introduction Company and Product Information Tesla Motors is a motor vehicle company based in the United States, whose primary products include electric cars and electric powertrain vehicle components, such as lithium-ion batteries, which it markets to other vehicle companies, including Toyota. Currently, the company is focused on becoming an independent manufacturer of not only cars but also complete auto parts, which is an effort towards the provision of affordable cars to middle-class consumers. The company has been working towards the delivery of several models of electric vehicles. It has already delivered two models: the Tesla Roadster and Model S (Sager, 2013). Its next model is Model X, whose delivery to the market has been postponed a number of times as the company sees to streamline its Model S supply with the global marketing objectives. Apart from the use of electricity as the primary source of energy, the model has many other benefits, which facilitate its efforts to target its niche in the global market. Currently, the company looks to deliver Model X in the next few months. Current Marketing Strategy The marketing strategy that is currently being used by Tesla Motors is simply focused on the delivery of the benefits that its cars have above many others in the market, especially in comparison to its key competitors. Primary focus is currently on the new model – Model X. The new model of Tesla electric vehicles, Model X, seeks to deliver a whole lot of advantages to the consumer. First, the model to be positioned is not weight-restricted – it weighs about 10 percent that the current models and has found a way to utilize more than half of the parts used by Model S (Garrett, 2012 ). This means that a whole of functionalities can be added to enhance the experience of the customer without worrying about the weight of the car, unlike in many models in the market. This model also provides you with a double-battery pack in an effort to enhance the length of time that the electric car batteries will last. Will model will also be able to accelerate to almost 100 km/h in slightly more than four seconds. This way, it exceeds the performance of many SUV’s as well as the currently provided sports cars. Unlike the current four-wheel drive cars in the market, Model X uses all-wheel drive capability, which utilizes two motors instead of one. The rear-wheel drive model will also be in supply to further enhance the customer experience, especially for off-road drivers (Garrett, 2012 ). The gull-wing doors, hinged to the bottom, will make it possible for the front edge of the vehicle to stay put close to the car, which further enhances the customer’s comfort while inside or parking. This also helps the driver and passenger exit with much more ease. Because the car is not weight-restricted, it will also have a tow bar, even though this will be optimal for the customer. This analysis just mentions a few benefits that the new car will provide to the customer, which will not be available in the electric car market anywhere else. These benefits, therefore, will evidently give the company a huge competitive advantage once the model is released to the market while at the same time developing trust and more buy-in for the existing models. Key Competitors It has to be accepted that Tesla faces stiff competition from various companies that have models already existing in the market. One of the largest competitors is Toyota, which has Lexus as its primary luxury model car in the industry. It can be associated with many strengths as well as weaknesses. Beginning with strengths, it is known that Toyota has the most extensive sales in the global motor vehicle market, which gives it the strength of being able to reach an expansive market with much ease. In addition, the company is able to cut across different social classes and its cars are the most affordable in the world. Thirdly, Lexus LX570, new newest model of the line, has earned immense popularity already in the market, which will be difficult for Tesla to compete with. However, it is clear that Lexus is fueled by fossil fuels, which are more expensive, compared to electric cars made by Tesla. In addition, it has more weight restrictions, as opposed to Tesla. Another key competitor with appreciating is BMW. The company has a fairly new product that enters the market about the same time as Tesla Model X or earlier, known as BMW X5 eDrive. This product has been associated with a number of strengths, mainly drawing from the strength of the parent company and its financial strength. The company has also been able to traverse the global market for quite a number of decades because it has had products already in the market and has established a global clientele that is substantially loyal. BMW is has a strong global presence, especially in developed countries. The new model, which enters in the market in a few months, therefore, might present some extent of competition for Tesla. However, just like Lexus LX570, it utilizes fossil fuels, which is a weakness, its low emission and high energy efficiency claims notwithstanding. Another weakness is that it is sold through its dealers, which eliminates the customer visitations to the factories as a key advantage. Mercedes-Benz is another competitor whose newest models have recorded substantial sales over the last few years. The company has new sports car models whose sales have bene boosted by the traditionally strong brand, which targets high-end customers. Despite its financial strength, Tesla has sold over 18000 cars in the united states as at 2014, far much more than the 11, 794 cars purchased in the same year for the Mercedes-Benz S-class (Rogowsky, 2014). This is a weakness of Mercedes Benz S class and a strength to Tesla Model S, which has higher and better implications for Model X. Business Intelligence Model X targets the environmentally conscious customers who seek more stable, less weight-restricted, and comfort-seeking customers. These customers also seek cars that have more flexibility in the sense that they can be customized at their wish, which is why the company makes it possible for them to visit the factories. The cars consume electric energy and have less damage to the natural environment. Customers that seek environmental responsibility, above the other benefits mentioned earlier, therefore, want this car. Tesla also offers Model X at a price significantly lower than that of the Lexus LX570 and that of the BMW X5 eDrive, which further makes the environmentally conscious consumer, who also seeks an affordable car, a viable target. Because the model will be available in showrooms in a few months, customers are attracted through billboards, TV commercials, and online videos on YouTube and other similar social channels. It is understood that the market size is small, but Tesla seeks to capture more than 50 percent of it not only in the United States but also in other countries in which Tesla has continued to perform well with preceding models, especially in Europe. Last year, Tesla sold 18,000 units in the US while Mercedes Benz S class sold 11, 794 cars, as has been mentioned above, Tesla hopes to sell more than 20,000 cars within a year of launching, meaning that it will have to acquire some of the customer base that key competitors mentioned above continue to enjoy. In an effort to vanquish the market segment targeted, Tesla will use experience promotions, customization, and customer testimonies to air its benefits. Key Findings, Implications, and Opportunities This analysis has established that Tesla, for a few years, has remained a favorite brand for many high-end customers despite the delays in the release of new products, owing to the fact that it has appeared to dominate the high-end market above its competitors, including BMW, Mercedes-Benz, and Toyota Lexus. As such, Model X is expected to withstand the current competition and exceed the target sales of 2015 and coming years, thanks to the benefits discussed above. The benefits that have been discussed above demonstrate that the company looks to identify the weaknesses that can be associated with the industry products presented by its competitors, such as weight restrictions and energy inefficiencies. After this, Tesla converts them into its strengths and continues to stand out in the market it only as an efficient car but also as a model that is friendly to the natural environment. At the same time, the car is inexpensive, making it possible to utilize the market while the aforementioned competitors continue to sell their cars at higher prices, with fewer benefits. This is a valuable opportunity for Tesla. It is necessary to add that the competitors discussed above have the potential to engage in a similar strategy. Looking at the products they are offering and their prices, they will adjust to the conditions that Tesla Model X’s strategy will precipitate, which has competition implications for Tesla. As such, Tesla might have the challenge to deal with new competitive prices and features for BMW, Lexus, and even Mercedes Benz. References Garrett, J. (2012 , 02 September). The New York Times. Retrieved Jan 04, 2015, from "Tesla Unveils Model X at Its Southern California Design Studios: http://wheels.blogs.nytimes.com/2012/02/09/tesla-unveils-model-x-at-its-design-studios/ Rogowsky, M. (2014, January 16). Tesla Sales Blow Past Competitors, But With Success Comes Scrutiny. Retrieved Feb 24, 2015, from Forbes: http://www.forbes.com/sites/markrogowsky/2014/01/16/tesla-sales-blow-past-competitors-but-with-success-comes-scrutiny/ Sager, R. (2013, July 01). Teslas Stocks Soar. Retrieved Feb 24, 2015, from First to Know: http://firsttoknow.com/teslas-stocks-soar Read More