Thursday, July 8, 2010

Assessing Tesla Motors (2)


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Alpha Situation
  • Tesla Motors is marketing a car that caters to the upper middle class.. Can they market cars that appeal to the masses?
  • Some of our associates believed that this company might follow the route of Tucker Car Corporation and De Lorean Motor Corporation. If it does not generate a consistent stream of profit within five years, they expected Tesla to go into the abyss in silence.
  • Two weeks after the IPO, who is ahead and who is behind?
  • Does Tesla's vision matches the reality?
Benefits
  • The possible patented battery technology
  • Currently possesses an alliance w/ Toyota
  • Secured an assortment of financial benefits with the U.S. government
Challenges
  • Will Tesla have the professional and technical capability to manufacture a car to the masses?
  • Will the masses accept an electric car as the norm for long range traveling?
  • What are the possibilities that the battery price rises?
  • Recharging the battery only increases the price of electric use.?
  • What are the possibilities of the battery polluting the environment?
  • What are the possibility of a newer car battery technology breakthrough that improves the traveling range of an electric car?
  • What is the probable possibility of another car competitor learning more about their battery technology and improving it within 12-20 months.
  • What is the long range possibility of Tesla becomes a part of Toyota?
Drawbacks
  • Tesla's management team currently lacks the strategic experience of running an auto company from ground up, their operating costs will escalate.
Efficiency/Flexibility
  • They will be learning how to efficiently manufacture cars from Toyota.
  • If the Tesla's battery technology is the alpha technology for this moment, They have the option to sell their patented battery technology to their competitors and other industries.

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