Tesla Case
TEAM MOCCASIN
INSTRUCTOR: PROFESSOR OLGA BRUYAKA
COURSE SECTION: CRN 15193 - MW - 2:30

TEAM MEMBERS: JENNIFER RICHMAN, ALEX TYROLER,
NATHAN FUGATE, MADISON THOMAS, ASHLEY SHIPLEY,
SUSAN FRICK
FILE NAME: TESLA_TEAMMOCCASIN_230PM_RICHMAN

Executive Summary
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Strategic Issue:
How can Telsa increase their product value and maintain a competitive advantage as new cars are entering the industry?

Underlying Causes:
Capital Funding
Niche Market Buyers
Increasing competition
Recommended Alternative #1
Focus on increasing the number of Supercharger stations.

Profit Margin Analysis

Financials
Important Financial Ratios

The first quarterly profit of
$11.2 million was reported in 2013

2013

2012

-3.68%

-95.88%

-0.62

-3.69

Current Ratio

1.88

0.97

Debt Ratio

72%

89%

Return on Assets

-0.03

-0.36

Return on Equity

-0.11

2011

-3.18

Profit Margin
EPS

-124.56%
-2.53

In conclusion, Tesla’s increasing profitability, liquidity, and solvency ratios shows an overall improvement in their current and future financial situation.

The External Environment of Electric Vehicles
● Rising trend in decarbonized vehicle due to poor air quality o Government support offered o limits on CO2 emissions o disincentivize ICEs
● Issues related to owning electric vehicles o long distance travel is not feasible o high cost to purchase
● Issues related to business model o ban on direct selling in certain states
● Forces in the Industry o high rivalry from existing luxury car manufacturers entering EV market o High threat of entry due to large resources of existing companies o Substitutes like Hybrids and ICEs are more affordable

Tesla’s Internal Environment
● New direct competitors o Panamera S-E and Cadillac ELR o less of a niche market
● Key resources