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Tesla Motors26/12/16Table of Contents 1. Executive summary……………………………….………...………………...… ….32. Analysis of the Situation………………………….………...……………….…… 43. Situational Analysis……………...…….……………………….………………. 104. Goals and objectives………………………….………...……………………….…145. Marketing strategies………………………….………......………………….… 166. Financial Data and Projection………………………….………...…….……… 187. Organization design………………………….………...……………….….……… 218. Implementation Plan………………………….……..……………….……… … …219. Evaluation and Control………………………….……..……………….….… ……2210. References……………………….………...………………………….….…… … 2311. Appendix………………………….………...……………………..….….…… … 24Executive summaryTesla established themselves as one of the leaders in the Electric Vehicle Market and a leader in innovations. It is the first fully electric that was mass-produced and was exported to foreign markets. We have developed a plan to introduce tesla motors for the first time in North Cyprus.Since the electric cars are not very popular in the North Cyprus automotive market as a part of our short-term strategy we want to gain North Cyprus’s residence awareness and meanwhile start to sell our product.? Taking all the facts into consideration, our strategy is to firstly to gain the communities awareness and then in the long term gain market share and increase our profit.After viewing our SWOT analysis and Porter’s Five Forces analysis we have identified our strengths and opportunities and have become aware of our weaknesses to improve them in the future. Since Tesla Motors Technology is a revolutionary in sustainable energy usage for transport and in same time North Cyprus government has developing a plan for reduce energy consumption and make a eco friendly city, we will have support of government to make it more effective their plan.However, using such a new technology still is in developing phase and may have some failures in process, we can minimize such a errors by acting synchronized with manufacturer to fix the failures in cars whenever it happens. According to our research we will not have any serious competitor since we are opening a new category in North Cyprus automotive market and we have government support. Tesla 1Analysis of the Situation:Analysis of the Companies Internal Environment Objective:Short term: Spread awareness across the North Cyprus through advertising and campaigns about the importance of electrical vehicles for the future in order to increase market share. Our aim is to sell about 50 units the first year and then expand our sales to 300 cars next year and also aim for selling 500 units annually, this is according to the history of the US market.Long term: Once we reached our goals in the North Cyprus market. Meanwhile, we should plan for establishing more than 100 supercharger stations in the country. Mission/Vision Statement: Mission: Our main goal when we first created Tesla Motors is still the same as when we started a decade ago. Our purpose is to accelerate the start of sustainable transport by bringing compelling mass-market electric cars to market as soon as possible. Our first product was going to be expensive no matter what it looked like, so we decided to build a sports car, as that seemed like it had the best chance of being competitive with its gasoline alternatives.Vision: Tesla Motors contributes to North Cyprus vision of developing the country into becoming environmental friendly. This helps Tesla Motors reach its vision of providing alternative mode transportation. Corporate Goals:All corporations should seek to increase their profitability level, if they want to remain in the business. Therefore, in order for our brand to remain in the market we should seek into developing and enhancing our products regularly. Increasing the range of products is essential because it will attract new customers. Whether it is through the development of new markets, our company needs to understand how to increase its profit both now and in the future to stay in the business and to achieve higher. Age and Capacity of EquipmentTesla Motors Agency in the North Cyprus is a new business so this part does not apply Financial Resources:Capital needed for:Human resourcesEquipmentPropertyLegal PaymentsMarketingExclusive Agency rightsTrainingCapital will be raised by loans and selling stocks to shareholdersInternal and External PolicesInternal polices Eco friendly facility setup, color in white to reduce needs for electricity Using bikes in the facility to reduce emissions, avoid using AC in winter to save electricity. Offering car lift service to all employees to not drive personal cars.External policesIndividual order using just in time method (no stocks) to avoid any overflow of stock.Maintenance pick up service for costumers to be more convenientPaying “ ? per minute” to costumers for every minute that company service is delayed. After 2 hours in regular maintenance. Market Analysis:Characteristics of target market:Geography: Our aim is to start in North Cyprus and try to sell as much cars as we can and target as much people as possible by convincing them of how suitable and practical it is.Demographic: Since we are launching a luxurious car with comfortable features our customers will most likely be males with an annual income that exceeds 300,000 ?, according to the US market.Psychographics: Since North Cyprus is developing into becoming an environmental friendly city, people targeted are the ones who are ethical and care for the environment. Income: This car suits different types of people, for examples, we have vehicles that suit families and we also have cars that are suitable for male drivers who enjoy sports cars and driving fast. Therefore, our cars run from medium income to high income depending on the buyer’s situation. Motivation/Expectation: In correspond to North Cyprus vision, this car will be made for environmental friendly usages and to reduce the coast spent on gas.Age: Our goal is to target everyone and all ages, but our main buyers would be male individuals that range from 30-60, as they are the ones who have a higher purchasing power. Participants Involved in Buying Decisions:Kids, mothers, young adults, friends, car bloggersInfluencersBuyersCar bloggers - will influence young adults by talking about car speed and the car technology and styleYoung adultsKids – will influence mothers by the safety and entertainment features in the car which would make the mother interestedMothersEnvironment – as the car is eco friendly green activists in the TRNC will persuaded to buy the carGreen activistsMarket Needs:The need of an fully electric car in the market No need to wait in line to get fuel (Time saving for business people)Saves money (no need for fuel)Quiet car (no noise pollution) Highly safe car How new offers meet those needs: Service package – efficient service (car is easy to service, takes max 2 hours and 3 hours with the pick up and drop off)Warranty saves money to the customer if there is any factory faults With the premium service customer will receive another tesla s model at the time of the service The battery capacity is largest in its range Tesla s model has a high safety ranking as it does not have a fuel tank, therefor the car will not explode in a major collision. Tesla SEQ Tesla \* ARABIC 2External Environment Analysis: Competition:Audi, Porsche, Lexus, Mercedes (SLS E-cell) and BMW (I-8) (Luxury and Hybrid cars) Tesla has fewer parts that mean there are fewer technical malfunctions, as the car has no motor VS its rivals.Tesla has a higher mileage range Fully customized not like other competitors Maximum 2 hour maintenance unlike other rivals Most of the competitors are hybrids (run on petrol and electricity) by our car is full electrical making it Political/ Legal / Regulatory:Middle East specs requiredSafety requirementsEconomical/ Demographics:Good GDP, StableHigh employment rateNationalization Low inflation rateSocial and Cultural:Four door cars are preferable in the North Cyprus. As drive Turkish stated “Factors taken into account include price and overall value, ride quality and comfort, build quality and materials, engine characteristics, on-road handling ability” and the top cars for 2014 all were 4 door family vehicles.Technological:Advanced software’sElectrical engineeringMore than 1,000 patens on intellectual ideasEnvironmental:Efficient, does not use fuelUses electricityTesla SEQ Tesla \* ARABIC 3Situational Analysis – SWOT and Porters five forces analysis:SWOT AnalysisStrengths:Energy efficient productStrong technological expertiseTheir current platform developed for Model S has the ability to be used for their future crossover model or any other model they envisionStrategic partnerships Weaknesses:New product, could have faultsBattery, distance problemsNot wide variety of productsPrice is higher than other luxury combustion engine powered vehicles.Opportunities:First electric vehicle agencyMatches TRNC visionEconomic welfare is stableOnly company specialized in fixing Tesla cars.The social norms in the UAEThreats:CompetitorsNew in the market No brand loyaltyNever tested in the TRNCSWOT MatrixTesla Motors Internal PositionStrengths:Tesla Motors is one of the most technological advanced car companies in the market. With this technology they were able to create an ultimate driving machine where they focused on being energy-efficient as well as having a fast car to compete with super cars. Tesla Motors has great intellectual assets within the company. That helped invent state of art electric transmissions and drive trains. Tesla Motors was also able to make their production platform a multipurpose platform so that it can be used for their future crossover model and any other model they plan to make. One of Tesla’s important strengths is their strategic partnership as a strong supplier for Toyota. This gives Tesla Motors an advantage over competitors as Toyota is one of the strongest car companies in the current industry and Tesla Motors can gain more experience from Toyota. The cost of maintaining a Tesla Motor is very cheap because of the use of advanced technology. It costs an average of 2100 ? a year to maintain one car.Weaknesses:Tesla Motors is still new in the car business. There may be some faults with their product. One of the greatest concerns and weaknesses is that the battery used in the car might not be able to cover long distance travels. This could limit Tesla Motors market share, as people that would want to go for long road trips would not be attracted to this product. Currently Tesla Motors only has a few products to choose from. This could also be strength as customers will not be confused with so many choices when trying to purchase a Tesla. However we consider this a weakness as having more products gives Tesla Motors a greater potential of increasing its market share. Lastly Tesla Motors price range is higher than other luxury combustion engine powered vehicles. This will make a customer think again about buying a Tesla and if it is worth the price.Tesla Motors External PositionOpportunities:With the world developing at a great rate there are many opportunities emerging. Tesla Motors has a great opportunity to attract customers interested in Electric Vehicles within the TRNC, as Tesla Motors will be the first Enterprise Value company to open an agency in the TRNC. This gives Tesla an advantage to penetrate this market before other competitors. Recently North Cyprus has set a vision of making TRNC a more Eco-friendly City. This gives Tesla Motors one of their greatest opportunities as they will support the leaders vision and there are possibilities of having the governments support with this project. They may help reduce our costs by lowering the legal payments or also helping advertise and encouraging Dubai citizens to invest in a Tesla. The economic welfare of the TRNC is stable. This is another opportunity for Tesla Motors as customers can afford to buy a Tesla car. Any normal garage cannot service Tesla Motor vehicles. Because they use specialized computers to check the cars system, this is beneficial for Tesla Motors, as their customers will have to come service their vehicles with us. Lastly from studying the social norms in the TRNC we found that people are attracted to new and unique products. With Tesla Motors being a new and unique product in the TRNC we are expecting many people to be attracted to the futuristic electric vehicle. Threats:Although Tesla Motors has many opportunities there are a couple of threats that must be accounted for as well. With Tesla Motors opening a new agency in the TRNC there will be a lack of experience regarding the market. Tesla Motors will also have a low market share because it is new in the TRNC. This may affect the companies’ revenue at the development stage. Tesla Motors has low or no brand loyalty in the TRNC as it is a new product and not many people have experienced the product. This will make it difficult to attract new customers, however by focusing on advertisements this problem can be resolved.One of the greatest threats that many car companies have in the island is the high temperature in the summer season. Based on historic events many cars have either caught fire or had mechanical failures due to the heat. Tesla Motors vehicles have been tested in Texas under extreme hot conditions. However the climate may differ in the island, which may cause a small risk of mechanical failures or even batteries exploding which can be really dangerous. Lastly companies in the TRNC that have a great market share might react to Tesla Motors sales of Electric vehicles in the TRNC.Car companies such as Toyota have well-developed vehicles such as Toyota Rav4 Hybrid and Prius. Also Chevrolet has the Volt 2 and Honda has the Civic Hybrid and the Smart car. All these vehicles are in the same category as Tesla Motors. Tesla Motors is able to differentiate itself from all these vehicles by being more luxurious and sporty. However this brings in more competition from the luxurious and sporty cars such as Mercedes-Benz, BMW, Porsche and much more.Porter?s Five Forces Supplier Power: We receive the supplies directly from Tesla Motors in the US, so there isn’t any supplier power. (Battery, Engine, Chassis/Engineering, Transmission)Buyer Power: Very low bargaining power as Tesla Motors is the only producer in this segment. Competitive Rivalry: High competition between major brands. However there is no other EV in that sector.Threat of Substitution: Low threat in the Enterprise Value sector, however high threat with luxury class vehicles. Threat of New Entry: Small number of competing vehicles, different niches. Also since fuel is cheap in the island not that many Enterprise Value companies are willing to take the risk to branch our in the island.Establishment of a strategic focus After looking at Tesla Motors SWOT and Porter’s Five Forces analysis we were able to identify the companies strengths and opportunities as well as the weaknesses and threats.One of the main strengths in Tesla Motors is the advanced technology used. Tesla Motors must focus on maintaining this advantage over customers by investing in intellectual assests. Tesla Motors main opportunity is North Cyprus vision of having an eco-friendly city. If Tesla Motors takes advantage of this opportunity there are possibilities of increasing the number of sales drastically if the products are advertised strategically.Although Tesla Motors has great strengths and opportunities there are some weaknesses and threats that must be focused, and finding a solution for these problems are essential to keep the business ahead of the competition. One of the main weaknesses of opening Tesla Motors in the TRNC is having low experience and market share. Having low experience may slow down the business and may also be costly, because Tesla Motors would have to pay for the mistakes that are made. In order to solve this problem it is important to hire employees that have great expertise in the car industry in the TRNC. This will help reduce mistakes and guide the company to increase their market share.Finally Tesla Motors will face a great threat regarding the scorching temperatures in the summer. The high temperatures may affect the cars mechanics; it could lead to a mechanical failure or explosion of the batteries. Tesla Motors must test the cars more heavily during summer in order to ensure the safety of their customers.Goals and objectives Marketing objectives: Top of mind, awareness. We want to reach top of mind and being known in the market by the customers. We will easily reach this as we are the only fully electric car in the TRNC market so its Product objectives:Ensure that the product is usable in the TRNC by providing supercharger stations. Also another objective is to ensure an eco-friendly environment by the usage of electric powered vehicle.Financial objectives:Attract more investors and maximize shareholder profit by increasing revenue and reducing cost. Tesla SEQ Tesla \* ARABIC 4Marketing strategies Marketing Mix actionsProduct mixProductAs a new category in the market our brand name is not well know for the local communities, but an advantage that we have as the TRNC is a globalized county, and a lot of people know the brand name from other countries such as Europe and the US. Tesla’s brand image is being eco friendly and being innovative and futuristic.There is no brand equity, as the brand is not known in TRNC.PriceSince product is its introduction cycle we plan to use price-skimming strategy as it has technological advancement. Tesla motors price policy is to set price (includes agency profit) by factory. So, we will sell cars base on Tesla motors suggested price adding handling and shipping costs. This make our price strategy Cost-Oriented with markup approach.Highly valued, as it is only fully electric car in TRNC so car price is slightly high which place it in premium Price category. Offering financial allowances such as no interest on installments or zero down payment requirements in introductory stage.Price for each order is dependent on the options that the costumer customized, which regards. For example extra option of having 2 additional reverse seats or different rims spokes or higher quality of interior leather.This is a luxury car and because of its origin it is inelastic.Promotion Gaining market awareness and educate people about fully electrical car and benefit of it.Because Tesla will be the first electric car in the TRNC, we have the objective of being the top of mind on electric vehicles in the country. Therefore, the marcom campaign will address not just the target but the whole population. Advertising: it is sedan car we try to reach all society because some are the influencer and other group are buyers. So for awareness we need to reach all market. TV ads, prints, banners, advertising stands in malls to show actual car and give flayers including information about car benefits and options to promote. Sponsorship of events. For newspaper, daily bases for two months. For specific magazines, one page in each period for 3 months. TV ads, for two weeks daily bases. Social media, YouTube and Facebook as they apply.Publicity and PR: stating our commitment to North Cyprus vision. Also, sponsoring Green (ecofriendly) activity related events. Sales Promotion: offering free service contract for the first 100,000 KM for unlimited time for the first three months as a opening offer. Personal Selling: both in advertising stands and in showrooms, our sales persons will assist visitors.We’ll develop an Turkish version of the tesla motors website that will suit Turks. Place/Distribution We will start with one shop in TRNC.Our first showroom and service center will be located in Girne as it has all the main dealerships in TRNC.Distribution channel is directly as we are direct agents of the producer.The cars will be directly shipped by tesla from the US to TRNC port. After custom clearance, carriers will derive cars to the facility. No electronic distribution as we are not going to sell the cars online Service MixPeopleWe will get professional employees from Tesla Motors US in order to train the employees in the TRNC. ProcessThe car service will take less than two hours. The car will also be picked up and delivered to customer’s location less than three hours.Physical EvidenceAs you enter the showroom of Tesla Motors a receptionist that will guide you around and show you the different products available will greet you. We also have premium service where we offer the customers a replacement car while their car is being serviced.Financial Data and Projection In US: 2013, 21,000 Model S Units sold2014, 40,000 Model S Units sold2016, 100,000 Model S projected to sellCosts:Cost Per Unit - 187,000 ?Shipping Per Unit – 10,000 ? Customs Per Unit – 5,000 ?Price Per Unit – 260,000 ?Tesla Motors has a market share of 0.006171% of the Auto Manufacturer sales in 2012 USOur projected market share in the TRNC for Enterprise Value is 100% as we are the only electric vehicles distributor in the TRNC. Our projected market share of cars is 0.01%, which is higher than the US market share, because the social norms in the TRNC can influence customers purchase preferences, and people like to buy new and unique products.Number of Cars sold in the TRNC: 2011 – 2110 Units2012 – 2450 Units 2013 – 2993 Units 2014 – 3039 Units2015 – 2665 Units2016 – 3200 units Projected2017—3500 units Projected US Car sales:2012 6,000 Units2013 33,000 Units2014 53,000 Units2015 77,667 Units 2016 101,167 units Projected2017 124,667 units projected Our projected car sales for 2017:Realist 55 units.Pessimist 30 unitsOptimist 80 units Our projected car sales for 2018:Realist 90 unitsPessimist 65Optimist 110Our projected car sales for 2019:Realist 150Pessimist 120Optimist 250 Tesla SEQ Tesla \* ARABIC 5Organization design Our company runs in a centralized structure where top managers make all the decisions (in the appendix) Implementation Plan In AppendixEvaluation and Control In the first year the company will operate at a net loss. However in the second year Tesla Motors will be receiving net income. In order to control these aspects we will aim to sustain our market share and try and increase it over the following years. As our objective is to sell 55 cars in the first year, we have a projected number of sale for the upcoming years and we can compare with our actual annual sales to understand and evaluate our current situation regarding market share.to calculate the market share we are going to compare our sales with the total of cars that were sold in the TRNC and then compare the past years with the current year to view the percentage increase in market share. Also by surveying our customers to see if the product has met their satisfaction and expectation. At the same time we are going to do an annual public survey to the brands awareness power and top of mind, which helps us to evaluate our marketing strategies.References analysisBuyer profile in US market30480092710Sales projection bases on US market history213995-146050Orginazational structure-657225227330Preceptual mapProjected sales-617220313690219075608965estimated income statement 2016Estimated income statement 2017Estimated Income statement 2018 ................
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