Tesla Motors 

1 Political

 

With selling cars in 17 countries of North America, Western Europe and Asia (Tesla, 2014), Tesla Motors has to deal with distinctive political patterns influencing its business operations.  One of the major political factors affecting the industry is environmental protection laws to induce production of more environmental cars to meet strict emission levels (Environmental-protection.org.uk, 2014).  The second important factor is US government energy loan programs for research and development of new vehicle technologies (Department of Energy, 2014). In this case, many auto manufacturers will be interested in entering the market.

 

2 Economic

 

Economic factors include economic growth in the alternative energy industries and increase in the cost of using the cars mainly due to the rise in fuel prices in the short period (BBC News, 2014). Therefore, the demand for more-efficient cars is higher than before. Next, recovery of GDP and inflation rate in most of the developed countries from the recessionary period in 2008/2009 has a significant impact on the customer purchase power (World Bank, 2014).

 

3 Social

 

Social factors are related to increase environmental concerns, attitudes and emphasis on products, which are “eco” friendly (Baki, et al. 2004). Buyers are losing faith in gasoline fuel and associated cost in production, trying to help the environment. Moreover, undoubtedly the current society judges people based on the type of the car they own (Autospies.com, 2008) and the idea of having electric vehicles improves the social status of an individual. Another social change is increase in ageing population with most wealth and savings, who would likely to spend more money on premium electrical cars (Reuters, 2014).

 

4 Technological

 

Technology advancement, rapid globalization and Internet impact have a huge effect on the automotive industry. Over the last years, much technology advancement has taken places within the industry, including the introduction of fully electrical cars and computerization of cars that allowed automotive driving and prevent drivers from accidents (Haveit-eu.org, 2011). This leads to more variety and more improvements in safety and convenience of cars in the future. Moreover, B2B platforms and market places have also given increased opportunities to the car industry that in turn increased efficiencies and reduced costs (Kachaner, et al, 2011)

 

5 Environmental

 

Over the last several years, many car manufacturers have faced the competitive pressure to produce eco-friendly or fuel-efficient vehicles. Environmental factors such as increasing awareness of climate change lead to changes in operations and companies’ products and services, because customers are getting more aware of environmental effects of production (Ypte.org.uk, 2014).

 

6 Legal

 

Many regulations emanate from green movements introducing energy loan programs and putting pressure on production eco-friendly cars such as increase taxation to incorporate the new methods of green business, the much expanded “carbon tax” and other green policies (Muller, 2013). Another major concern is franchise laws in US that protect car dealers and creates challenge to Tesla selling its car directly to customers (Fisher, 2014). Other factors that might affect the manufacturing of battery car include the tax incentives and subsidies to increase the demand among consumers (Ministry of Transportation, 2010).

The issues covered throughout the PESTLE analysis shaped many opportunities for Tesla Motors for further expansion and success of electrical cars within automotive market. However, together with opportunities they also creates threats, thus, the company should be concerned about rapid technology advancement and political regulations within the industry it operates.