Tesla Model 3 Marketing Environment

Tesla Model 3 Marketing Environment

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           Tesla wanted to prove a point when it was founded by engineers in 2003, that electric cars can be produced and they can be more fun and quicker than gasoline cars, and yeah they proved that. The belief of the company that it is time that the world stops relying on fossil fuels and go towards zero-emission is a step towards the right direction for the company (“Tesla’s mission is to accelerate the world’s transition to sustainable energy.”, 2020). The company launched the first the Roadster in 2006 and since then the cars have only got better and better with the latest Tesla Model 3 which began the production in 2017. The discussion below will focus on the Pestle analysis of the Tesla Model 3 car; these are the external forces that play a part in the company’s growth either positively or negatively.


           To conduct any business in any environment the political stability of the country must be ensured, this is because that countries that have insecurity will affect the operation of the business which will reduce the revenue of the firms. Unfortunately, most of the Tesla cobalt product that it uses is from Democratic Republican of Congo (DRC) and this has caused conflict, child labor and corruption, this is bound to affect the company. Also, every country has set regulations that the company interested in selling have to meet, lately, the requirement that all company must produce energy-efficient products plays a big role in marketing the Tesla model 3(Elsayed Elrayes, 2016).


           They are various economic factors that can affect Tesla, one is the foreign exchange rates that affect the company since its operations are in international markets and this is the reason that the company in 2015 recorded some losses because of these fluctuations. The different taxation and tax rates affect the revenue of any company but Tesla has benefited from the incentives provided by Nevada since they are provided abatements for property taxes, personal and real taxes, and tax credit until in the year 2034. Also, California, where the Tesla company is located, has awarded them the ZEV credits which are tradable hence benefiting the firm because of its investment in zero-emission products (Elsayed Elrayes, 2016. Also, the cycles in the economy play a big part wherein a boom the market demand is high hence high revenues and during the recession the revenue decreases because the consumers purchasing power is affected. 


           Every company has to ensure that it can compete in the market even when there are similar products across an industry there is a need to ensure that the advantage is greater if one is to get profit. For Tesla one of these factors is the structure of the organization that is composed of innovators who always make the decisions together hence eliminating the bureaucracies that affect most industries (Binkiewicz et al., 2008). The recognition of the brand in both the global and local market has placed them on another level and the increase in the number of cars they produce have ensured that their customers can get the products. In addition, to take the stand in the competitive market the Tesla the horsepower is none like any other companies and its two-seater car is a design that most people looking for lavish just want (Moritz et al., 2015). However, the prices of this car are one factor that affects these advantages since their customers are wealthy people earning more than $100,000 and in some cases, they have failed to meet the targeted products.


           Technological advancement plays a big part in the automobile industries and is one way that companies try to stand out in the product quality. With Tesla, the fact that the cars are zero-emission and do not run on gasoline is one factor because lately they have been reports on climate change and people are trying to use products that hardly emit gases to our already poor air quality. Tesla was the first company to introduce the all-electric car and this has led to it having a position and the continuous innovation in the latest model is proof that technology is placing the industry in its platform (Binkiewicz et al., 2008). Lastly, technology have increased the market base for the product and its reach where people are able to learn about the product and its features from their homes.


           The social factors affect the buyer’s decision when it comes to the type of products to buy. Tesla cars are built for the wealthiest people and as its the norm wealthy buyers tend to value quality over pricing, this has been recognized by the shops set up by the companies in places they can access these consumers. Also, consumers’ purchase behavior seeks economic benefits hence the focus of consumers now on energy efficiency products plays a part in how Tesla is thriving in the automobile industries (Elsayed Elrayes, 2016. 

Legal and Regulatory

           These are every state regulation that every country sets for all industries, they range from the operating to labor laws and if not adhered to the company can be liable to penalties that affect the revenue of the firms. Tesla is situated in California and the incentives it receives in terms of subsidized taxes is proof that it does no only meet the countries regulation but its already leaping benefits., this is because of its cars being eco-friendly (Moritz et al., 2015). Unfortunately, the Tesla Model 3 faces the problem that they cannot transact with the consumers directly because if the franchise laws of the US.


Every company for it to sustain in the global market it has to ensure that the external forces which can affect the revenue of the company negatively are mitigated, Tesla Model 3 is a car that in all its form and production is giving the company standing in the automobile industry despite them targeting the high-end consumers.


Binkiewicz, N., Chen, J., & Czubakowski, M. (2008). Tesla Motors [Ebook] (pp. 2-6). Retrieved 5 March 2020, from https://www.mcafee.cc/Classes/BEM106/Papers/2008/Tesla.pdf.

Elsayed Elrayes, A. (2016). Tesla Marketing Strategy. Slideshare.net. Retrieved 5 March 2020, from https://www.slideshare.net/AhmedElrayes7/tesla-marketing-strategy-61953373.

Moritz, M., Redlich, T., Krenz, P., Buxbaum-Conradi, S., & P. Wulfsberg, J. (2015). Tesla Motors, Inc.: Pioneer towards a New Strategic Approach in the Automobile Industry along the Open Source Movement? [Ebook] (pp. 3-13). Retrieved 5 March 2020, from http://www.openproduction.info/wp-content/uploads/2016/03/Moritz-et-al_Tesla-Motors-Inc_Pioneer-towards-a-New-Strategic-Approach.pdf.

Tesla’s mission is to accelerate the world’s transition to sustainable energy.. Tesla. (2020). Retrieved 4 March 2020, from https://www.tesla.com/about.

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