Strategic Management: A Competitive Advantage Approach, Concepts and Cases, 16/e
by Fred R. David, Forest R. David
External Issues
Electric and hybrid cars remain a very small fraction of overall car sales, and no company yet has actually turned a profit making electric cars. Tesla does have a significant head start with its battery technology and the distance its cars are able to go per charge, but gas prices are low and customers are actually trending toward larger rather than smaller cars.
Tesla serves an international market and has a global supply chain, but most of the Model S vehicles are built in North America, so a strong dollar has a slightly negative net effect on the company’s profitability. In markets where the local currency has declined significantly versus the U.S. dollar, Tesla recently increased prices by only about half that decline. The ...
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