Tesla’s business model is different. Identify at least three ways in which the Tesla model differs from the traditional automotive business model and briefly describe the impact of your findings in at least the areas of value proposition, markets, customers and channels.

CASE STUDY

Incorporated in 2003, Tesla declared in its mission statement that its goal is “to
accelerate the world’s transition to sustainable transport,*” and it has proven itself a
leader in green technology in the automotive sector. In its initial business plan, by cofounder Martin Eberhard, the electric sports car company promised to provide the
value of a high-end sports car at a lower cost to the customer and a lower
environmental cost to the planet. Electric vehicles were seen as inferior to standard
vehicles prior to Tesla’s innovations in creating powerful cars that piqued consumer
desire. The generic automotive manufacturing business model relies on collaborative
manufacturing with industry partners and a distribution model dependent on third
parties. Standard cars are aimed at people and businesses with individual
transportation needs. This model is commercially viable because of custom-equipped
add-on features to the per-vehicle prices.
Questions for Case Study :
Tesla’s business model is different. Identify at least three ways in which the Tesla model
differs from the traditional automotive business model and briefly describe the impact
of your findings in at least the areas of value proposition, markets, customers and
channels.
*: In 2016, it was changed from “sustainable transport” to “sustainable energy.”
C