Case Analysis Tesla Motors Inc. - 1448 Words

Tesla Motors Inc. has a competitive advantage in the market for many reasons of which you are responsible for. However, I believe Tesla is exposed to two major risks that have not been adequately addressed by the firm. The first is related to the capital structure, specifically the debt and equity financing agreements. If you recall the 2014 Q3 Earnings Call, you mentioned that small miscalculations of financial estimates could have enormous effects on the actual results for companies in the exponential growth phase. That being said, your strategic direction should focus on reducing the exposure of debt repayment obligations and your reliance on equity valuations that continue to rise. The level of confidence among creditors and investors cannot fluctuate too much because your highly leveraged position. CapEx in the next two years will only decrease slightly and seeing that Tesla’s debt is classified into the category of â€Å"junk bonds† – confidence may b e slipping. Both debt and equity financing sources could become too costly to sustain operations. The second concern I have is the concentration risk that electric car sales alone will fund operations, despite possible shifts in the short-term macroeconomic environment. You once said â€Å"it’s not the machine, it’s the machine that makes the machine that is difficult.† The heavy RD cost incurred to develop the machines that make machines are necessary to maintain your advantage in the market. I strongly suggestShow MoreRelatedCompany Profile Of Tesla Motors1364 Words   |  6 Pages History of Operation Tesla Motors was incorporated in 2003. in 2016, it began production of the Roadster in 2009, Model S unveiled. in 2010, TSLA IPO launched; Announced partnership to develop powertrain system with Toyota RAV4. in 2012, it Started building Supercharger Network across America and Unveiled designs and plans for Model X. in 2013, Tesla got Extreme Tech â€Å"Best Selling Luxury Car. IN 2014, Gigafactory announcement 200th Tesla Charging Station opened, and Musk announces anyone canRead MoreCase Study of Tesla Motors Inc. Essay examples1192 Words   |  5 PagesTesla Motors Inc. is an American public company which is known worldwide because of its experience in designing, manufacturing and also the selling of electric cars and electric components for vehicles. The motor was started back in the year 2003 in San Carlos, California in the United States (Teslamotors.com, 2014). The company had its headquarters in Palo Alto and at the time of its inception, Elon Musk was its chief executive of ficer (CEO) (Hunger, 2010). Environmental concerns have been raisedRead MoreEssay on Tesla Motors925 Words   |  4 PagesTelsa Motors, Incorporated As upper-level management it is important to understand the key components of cost-volume-profit analysis. Identifying objectives including concepts related to CVP is crucial to the absorption of information. The paper provides a summary of Tesla Motors, the company outlined. Explaining the relationship between cost-volume-profit analysis is discussed as well as how the company is using this tool to maximize production and profit. Summary Tesla MotorsRead MoreAnalysis Of The Green Technology Vehicle Market1934 Words   |  8 Pagesmarket. One of the main green technology vehicle market is the introduction of electricity vehicles. Tesla motors is the electric car manufacturers in the United States. The American company is a car company, was founded in 2003, and is composed of a group of engineers in Silicon Valley engineers who is a brainchild of Martin Eberhard, Marc Tarpanning (Kebede, 2014).Depend on the strategy side, tesla motors continue to apply creative technology to develop sustainable transport. At present, its vision statementRead MoreTesla Motors Case Study. As Pressure Increases The Need1740 Words   |  7 PagesTesla Motors Case Study As pressure increases the need to develop alternative forms of powering the worlds petroleum powered vehicles a new company is attempting to disrupt to auto industry with a business model that challenges the status quo and force entrenched incumbents to alter their current vision for the future of the automobile market. Tesla was created to directly address the challenge of creating a viable alternative to the internal combustion engine. Tesla is the first company that commerciallyRead MoreAdvanced Strategy Case : Tesla Motors Inc. Essay2722 Words   |  11 PagesAdvanced Strategy Case: Tesla Motors Inc. Student Name Course Institution Introduction When you talk about a world leader in electric vehicle (EV) business, there is one name that always jump right into people’s minds. That is Tesla. Tesla Motors Inc. is the world’s largest manufacturer and vendor of electric vehicles (EV) powertrains. The company under a multiyear agreement with Toyota also supplies full powertrain for Toyota RAV4 EV (Tesla Motors Inc., 2015). Tesla has expanded its relationshipsRead MoreA Report On Tesla And Solutions Essay1576 Words   |  7 Pagesissues, the company should utilize the vehicles which are not contaminating the Earth s surroundings. Electrical autos regard use to beat these issues. Tesla is one of the top organizations to give great electrical autos, however, in the couple of portions it is absent to fulfill it higher. Those are Price, Marketing Strategy and its Range, If Tesla pursues these challenges, then it would be the better Electrical auto organization on the planet. The investigation of these recommendations and implementationsRead MoreEssay on Tesla Motors Financial Analysis2341 Words   |  10 Pagesï » ¿ Tesla Motors, Inc. Financial Analysis Project Accounting II – Dr. Frazer Themistoklis Tambassopoulos Introduction In this paper I intend to provide a sound financial analysis of Tesla Motors Incorporated. I will do so by calculating and providing liquidity, profitability, and solvency ratios and then evaluating those results. Assessment of these ratios will more or less define Tesla Motors’ abilities to meet its short-termRead MoreAlternative Sources Of Energy Essay961 Words   |  4 Pagesconsumption and the increasing demand for consumer goods around the world. Rapid oil depletion has increased the call for renewable and diversified sources of energy given the unsustainability of oil-dependent economic development. Elon Musk, CEO of Tesla,Inc. believed that in the future solar and wind farms can provide electric power when the sun is not shining and when the wind is not blowing by storing electricity generated when the sun is shining or the wind is blowing in new types of batteries. HeRead MoreThe Electric Vehicles Made By Tesla Motors3146 Words   |  13 PagesSurvey of Tesla Motors Electric Vehicles NAIXUAN MA Department of Electrical and Computer Engineering Rutgers University Piscataway, New Jersey, 08854 naixuan.ma@rutgers.edu 6 Abstract This paper mainly introduces the electric vehicles made by Tesla Motors, Inc. in many aspects, including comparisons with traditional gasoline-fueled vehicles, environmental impact, 5-years ownership cost, safety and ease of use. At last, drawing the conclusion that for a relatively long period, choosing a