Tesla Proposal 2
Executive Summary
After experiencing tremendous growth in the past few years, Tesla needs to contemplate on the idea of becoming an auto industry giant. In its current situation, Tesla cannot achieve that monumental goal because its cars are too expensive for the average consumer. According to USA Today the average price of new car is $31,252. The basic Model S costs $62,400, which puts it out of the reach of the average consumer. Tesla cannot become like their counterparts at Ford or GM, unless they start producing lower priced vehicles. In order to produce these vehicles, Tesla has to cut its production costs and step out of the luxury electric vehicle niche they have created for themselves. My proposal covers three methods that will help Tesla reduce production costs and make them a volume seller of automobiles. The methods are to reduce the production costs of the battery pack, eliminating the luxury features of the vehicle, and reintroducing the more affordable 40kwh model that was canceled. With the implementation of these three methods Tesla will be closer to achieving their goal and obtaining a larger market share.
Introduction
Many people believed that the electric car was dead, that was until Elon Musk founded Tesla Motors in 2003. Musk has catapulted Tesla into becoming the number one producer of electric vehicles (EVs) and also become the iconic automaker of EVs. The rise of the EV was caused by the public’s concern for the environment. They wanted eco-friendly cars, but the problem is that the technology to produce these vehicles is still very expensive. The basic Model S from Tesla will cost you $62,400, while the premium version will cost you $132,070 (teslamotors.com). The majority of the public is looking to spend an average of $31,252 on a brand new vehicle (usatoday.com). Tesla’s basic Model S will cost two times more than what the average consumer wants to spend, while the premium version is not intended for the average
After experiencing tremendous growth in the past few years, Tesla needs to contemplate on the idea of becoming an auto industry giant. In its current situation, Tesla cannot achieve that monumental goal because its cars are too expensive for the average consumer. According to USA Today the average price of new car is $31,252. The basic Model S costs $62,400, which puts it out of the reach of the average consumer. Tesla cannot become like their counterparts at Ford or GM, unless they start producing lower priced vehicles. In order to produce these vehicles, Tesla has to cut its production costs and step out of the luxury electric vehicle niche they have created for themselves. My proposal covers three methods that will help Tesla reduce production costs and make them a volume seller of automobiles. The methods are to reduce the production costs of the battery pack, eliminating the luxury features of the vehicle, and reintroducing the more affordable 40kwh model that was canceled. With the implementation of these three methods Tesla will be closer to achieving their goal and obtaining a larger market share.
Introduction
Many people believed that the electric car was dead, that was until Elon Musk founded Tesla Motors in 2003. Musk has catapulted Tesla into becoming the number one producer of electric vehicles (EVs) and also become the iconic automaker of EVs. The rise of the EV was caused by the public’s concern for the environment. They wanted eco-friendly cars, but the problem is that the technology to produce these vehicles is still very expensive. The basic Model S from Tesla will cost you $62,400, while the premium version will cost you $132,070 (teslamotors.com). The majority of the public is looking to spend an average of $31,252 on a brand new vehicle (usatoday.com). Tesla’s basic Model S will cost two times more than what the average consumer wants to spend, while the premium version is not intended for the average
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