Question: Explain core and distinctive competencies/capabilities of Tesla (from

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Explain core and distinctive competencies/capabilities of Tesla (from the case above).

CASE 17 Tesla Motors' Strategy to Revolutionize the Global Automotive Industry Arthur A. Thompson The University of Alabama n his February 2014 Letter to Shareholders, Elorn The Tesla Model S had received widespread Musk-an early investor in Tesla Motors and its praise and acclaim not only as the world's best current chairman and CEO-was pleased with the electric vehicle but also as a product far superior company's future prospects. Tesla's strategy was to any other brand or model of electric vehicle cur producing rapidly improving results, and by all indi- rently on the market. In 2013, the Model S was the cations the company's execution of the strategy was most awarded car in the United States. In picking very much on track. Musk's report left little doubt that the 2014 Tesla Model S as the "best overall" model Tesla Motors was making good progress in its journey out of 260 cars tested, Consumer Reports awarded to manufacture premium-quality, high-performance the Model S a score of 99 out of 100 (the highest electric vehicles capable of winning widespread score any vehicle had ever received from the mag customer acceptance and accelerating the world's azine) and described it as "a technological tour de transition from carbon-producing, gasoline-powered force" with "blistering acceleration, razor-sharp vehicles to energy-efficient, environmentally respon handling, compliant ride, and versatile cabin." The sleek styling and politically correct power source After suffering five ycars of losses of the Tesla Model S was thought to explain why ing $943.5 million on combined revenues of just hosands of wealthy individuals in North America $861 million between 2008 and 2012, Tesla delivered and Europe-anxious to be a part of the migration 22,477 of its recently introduced Model S vehicles from gasoline-powered vehicles to electric-powered to customers in 2013. Production rates had recently vehicles and to publicly display support for a cleaner increased to 600 vehicles per week and were expected evironment-had become early purchasers and to reach 1,000 vehicles per week by year-end 2014. advocates for the vehicle. Indeed, word-of-mouth Tesla reported global revenues of $2.0 billion in 2013 praise for the Model S among current owners and and over S100 million in net income on a non-GAAP glowing articles in the media were so pervasive that basis. Deliveries to customers in Europe began in Tesla had not yet spent any money on advertising to August 2013, and deliveries to China were set to boost customer traffic in its showrooms. In a presen begin in spring 2014 the company's sales show tation to investors, a Tesla officer said, "Tesla own- sible electric vehicles. ers are our best salespeople."2 room in Beijing was already generating the heaviest traffic of any of Tesla's showrooms worldwide. Musk In fall 2013, the Model S ranked as the best was confident that sales of Tesla vehicles in Europe seing car in 8 of the 25-wcalthiest zip codes in the and China would exceed sales in the United States United States, as ranked by Forbes.3 At the top of in two, or no more than three, years. Tesla was wel ha list was Atherton, California, a Silicon Valley along on its plan to begin producing two new mod town near Tesla's Palo Alto headquarters where the els in 2014-2016-an SUV and a mid-priced sedan. median home price in 2013 was $6.65 million. Other The company's stock price had climbed from $34 in January 2013 to over $250 in March 2014 Copyright2014 by Arthur A. Thompson. All rights reserved.

Explanation / Answer

As per the case excerpts, the core competencies of Tesla Motors are vehicle engineering, innovative manufacturing technique and the ability to power train. The distinctive competencies of the company are its advancement in battery pack technology, its ability to produce with safety design and distribution. These competencies have given the competitive edge to Tesla Motors.

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