Tesla Case Study

Keywords: tesla motors case analysis, research study on tesla

A CASE STUDY ON TESLA MOTORS

Cost/Benefit Analysis

In business, every decision that has to be made requires thorough evaluation. And one of the most convenient and straightforward solutions to do that is through Cost/Benefit Analysis. In CBA, an estimation of the full total value of all benefits associated with a certain project is in comparison to that of the worthiness of the costs that are needed in order to realize such project (Watkins, n. d. ). For the assessor to create a better angle of comparison, these values must be expressed into a uniform unit of measurement. Usually, in computing CBA, the values of the price and benefits are converted into their value. Once all the expenses and great things about the project have been taken into consideration, comparison may be achieved. If the value of the huge benefits outweighs that of the expenses, it means that the project is an advisable endeavour. The next point of evaluation would be the calculation of the break-even point - enough time at which the advantages of the project pay off the expenses (Hill, 2012). It would be most preferable to have a shorter payback period.

Generally, CBA helps business people to decide whether or not to undertake a particular project. It allows those to frame the best and appropriate project objectives. Furthermore, CBA can be used to prepare the necessary resources as well as develop before and after measures of the project's success. For example, the proceed to promote more ecological businesses and processes for the company may desire a Cost/Benefit analysis to determine the possibility of its realization. As the corporate world is now increasingly more aware of the effects of Climate Change, companies want to implement environment-friendly practices in their offices. The identical is true for huge manufacturing companies. CBA allows the companies to evaluate probable gains and losses these actions may bring.

Tesla Motors: A Case Study in Environmental Impact

Background and Operations of Tesla Motors

Leading the advent of a more sustainable transportation system and its own innovations, Tesla Motors has generated quite a reputation in the automotive industry. Since its establishment in 2003, the business is continuing to grow to be the biggest manufacturer of electric cars on the market. It has contributed more than 50, 000 cars in roads across the world as of today (Tesla Motors, n. d. ). Its main goal is to make a transportation system that is more environment-friendly and sustainable.

Electric cars are charged at home and do not require refuelling of gasoline unlike the cars created by other manufacturers. Quite expectedly, these zero-emission cars weren't easily accepted on the market as they were deemed impractical, not forgetting consumers weren't really impressed with their rather tacky design. Fortunately, Tesla Motors could flip that equation. By releasing their trailblazer electric sports vehicle for the high-end market, the Tesla Roadster, these were in a position to capture the attention of car enthusiasts and change the facial skin of the green car market.

After releasing the Roadster, Tesla pushed for more space on the market by releasing their luxury sedan, the Tesla Model S in 2012. More and more consumers are looking to buy electric cars because of the innovations which were done by the business. Actually, reservations for his or her next model releases already are piling up. There is much anticipation for the Tesla Model X and Model 3 releases.

How Green is a Tesla Green Car?

The very purpose of an electric car is to market energy innovation; and Tesla Motors' goal is to achieve this without triggering any negative effect on the surroundings. However, a new technology like the impressive green car production cannot be designed to pass without being thoroughly criticized by the public. Green cars are, by principle, more environment-friendly than the conventional fuel-based cars. The procedure, by which it is being manufactured, on the other hand, says otherwise. Furthermore, green cars do run on electricity. But, how is electricity being processed? Does it not result from coal and petroleum too? With that said, is a Tesla green car green after all?

The company admits that the degree of being environment-friendly of their cars - take the Model S for example, mostly will depend on where and exactly how often the car is being driven. In the US, each state has a different mixture of energy sources that basically switches into their grid. Quite simply, a "cleaner" electric source makes a Model S a far more environment-friendly car. Generally, it is still cleaner than the internal-combustion design of their opponents in terms of emissions-per-mile; considering the efficiency of battery-powered cars in converting stored energy into a useful form (Oremus, 2013).

Tesla Motors and the Campaign for Environmental Sustainability

Tesla Motors established its campaign to promote a greener personal transport system through its electric vehicles; but so how exactly does it impact the surroundings in the professional context? Are its processes and businesses regarded as environment-friendly?

The company is very much aware of the actual fact they are indirectly releasing carbon emissions through power plants - considering that electricity is the primary power way to obtain the vehicles. This is why why Tesla moves to promote the absolute removal of indirect carbon emissions by using Supercharger Stations that only uses grid electric power from solar panels (Walsh, 2014). Moreover, Tesla is teaming up with SolarCity to provide electric car owners a choice to charge their cars using solar power panels in their respective homes. That is like hitting two birds with one stone. Through the elimination of the necessity for coal-based electricity source, they are really indirectly reducing carbon emissions in the atmosphere; and they're promoting the use of renewable energy source at exactly the same time.

Tesla is actually solving the world's dependence on gas. Through their revolutionary innovations in electric vehicle technology, they have addressed a concern that has been thought as an improbability for many years. By making far more convenient adjustments in their electric cars, and at exactly the same time proving that electric cars are indeed effective, Tesla has convinced more consumers to patronize their product. The business is winning increasingly more battles as they advance into bigger ventures.

In order to cater to their growing consumer demands, Tesla is building their initial Gigafactory. Panasonic will be a huge investor in this project, along with Tesla's other major partners. A very important thing relating to this gigafactory is the company's plan to run it mainly on wind and solar energy. Nevada is the perfect site for the factory since it is where the biggest solar powered energy plant on earth is situated.

Tesla does not only serve as a leader in electric car technology, additionally it is learning to be a model for others to consider more environment-friendly processes. Coal mining and processing has generated many environment-related issues and are still leading to problems in many places around the world. If Tesla becomes successful in eliminating the necessity for non-renewable sources of energy in order to create electricity, it can transform the face of the automobile industry forever. Not only will it considerably reduce the carbon emissions that are released to the atmosphere, it will also eliminate the conditions that are brought about by the processing of electricity that is coming from natural resources.

Tesla Motors and the Competitive Industry

Of course, Tesla Motors is not the sole company that has entered the green car market. Despite the fact that the industry for green cars isn't that big compared to the conventional automobile market, it could be said that competition is not too lax. Actually, Toyota, Ford, Nissan, and Honda are considered as the largest rivals for Tesla. Audi, Volkswagen, and BMW are looking to become listed on the green car industry soon. And these are pretty huge companies. Can Tesla keep its place in the industry without being squeezed out by giant car manufacturers? What's its competitive advantage?

Unlike the rest of the automobile manufacturers, Tesla is 100% in the green car industry. Thus, their focus is merely within that market. Research and development is solely dedicated for this function, allowing the company to produce better innovations. Also, Tesla has about 5-year head start over the other companies. While other companies remain building their green car designs, Tesla is already polishing its own.

The future of the automotive industry is leaning towards the utilization of renewable resources of energy. This basically means that others who are on the other side of the industry are at a huge disadvantage. Oil is going to run out; but solar powered energy is unlimited. Ultimately, they will have to shift to a more sustainable way to obtain energy.

Tesla Motors and the Future of Green Car Technology

At as soon as, Tesla's priority is to increase its production in order to meet up with the demands for the Model S and Model X in the market. They are experiencing troubles in meeting customer demands using their very limited production. But the public can rest assured that Tesla will not stop creating better innovations for their products. Once the gigafactory has been installed, Tesla's next focus will be on the development and improvement of automated driving technology. As a matter of fact, the business's CEO, Mr. Elon Musk has announced the release of the partially self-driving vehicle by 2017 (Boyadjis, Rassweiler, & Brinley, n. d. ).

As the technology for zero-emission cars progress, the problems regarding the automobile companies' effect on the environment is being addressed gradually. Someday, there should come a time when vehicles will solely be based upon solar power - among other renewable energy sources. It might not totally solve Global warming, but it will help the world get there one step at the same time.

References

Boyadjis, M. , Rassweiler, A. , & Brinley, S. (n. d. ). Object moved. Retrieved from https://www. ihs. com/articles/features/tesla-motors. html

Hill, R. (2012, September). Attention Required! | CloudFlare. Retrieved from http://www. mindtools. com/pages/article/newTED_08. htm

Oremus, W. (2013, September 9). How green is a Tesla? Electric cars' environmental impact is determined by where you live. Retrieved from http://www. slate. com/articles/technology/technology/2013/09/how_green_is_a_tesla_electric_cars_environmental_impact_depends_on_where. html

Tesla Motors. (n. d. ). About Tesla | Tesla Motors. Retrieved from http://www. teslamotors. com/about

Walsh, T. (2014, November 1). Investing in Socially Responsible Companies: Tesla Motors Inc. Retrieved from http://www. fool. com/investing/general/2014/11/01/investing-in-socially-responsible-companies-tesl-2. aspx

Watkins, T. (n. d. ). An Introduction to Cost Benefit Analysis. Retrieved from http://www. sjsu. edu/faculty/watkins/cba. htm

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