Researching tesla electric vehicle overview

Contents INTRODUCTION AUTOMOTIVE INDUSTRY AND TESLA MOTORS .3 1.1 History of the company 1.2 Tesla Motors 1.3 Evolution of Tesla ANALYSIS TESLA MOTORS .6 2.1 Identifying core competencies and capabilities of Tesla Motors 2.2 Business model 2.3 Tesla Motor SWOT 2.3.1 External analysis .7 2.3.1.1 Porter’s five force model 2.3.1.2 Stakeholder Analysis 11 2.3.2 Internal Analysis 13 2.4 Tesla Motors’s business strategy 16 2.5 Tesla motor technology strategy 18 2.5.1 Tesla’s secret weapn: intense focus on batteries .18 2.5.2 Engine block .20 2.5.3 Autopilot System 22 TESLA AND COMPETITORS 24 3.1 Competitors .24 3.2 How is Tesla going to compete? .26 3.2.1 Innovative lithium ion batteries .26 3.2.2 Large network of supercharger stations 27 UNIQUE DIRECT-TO-CUSTOMER SELLING MODEL .28 DEVELOPMENT OF LITHIUM CELLS “ GIGAFACTORY” 28 REFERENCES 30 INTRODUCTION Today, the level of environmental pollution has been a problem that many developed countries have to deal with, not only that, human health in industrialized countries is also going down Transportation industry is one of the most toxic gas emission industries In particular, internal combustion engines are one of the core causes of heavy pollution as today The amount of NOx, SOx, CO2, COx is extremely toxic not only to humans but also to the earth directly - our green house In that situation, special leaders in European countries have set milestones to completely replace diesel-powered vehicles and including gasoline engines with electric motors In the US, nature lovers and careers are willing to order electric cars despite high costs and many shortcomings, pioneer in electric vehicle industry in the US is Tesla In the automobile industry, electric vehicles have been researched by manufacturers for a long time, but the achievements are not much Chevrolet Bolt, Hyundai Ioniq, Nissan Leaf were the electric cars of the previous Tesla Model However, these models are not much interested Although not the first electric car in the world, Tesla Model got an order beyond expectations 276,000 units were sold after days of launch, bringing Tesla nearly 10 billion USD So why does an electric car come to life that makes people so crazy? It is even considered by the world's users as the "apple of the automotive industry" It can be explained by a fairly simple phrase, because Tesla is different from traditional cars Where did the difference come from? To get an overview of the reasons for that remarkable difference, our group below is the topic: "Researching Tesla electric vehicle overview." AUTOMOTIVE INDUSTRY AND TESLA MOTORS 1.1 History of the company - Tesla is a name taken from an American inventor (Tesla Nikola), who was born in 1856 in 1943 Tesla is known for his revolutionary contributions in the fields of electricity and magnetism in the end of the century 19 early 20th century - Founded as Tesla Motors, Tesla Inc Founded in July 2003 by Martin Eberhard and Marc Tarpenning Both played an active role in the early development of the company before and after Elon Musk's involvement - Elon Musk was a well-known investor, PayPal was sold and he earned 170 million USD M usk is focusing on SpaceX aerospace project The paperwork was drafted and finalized on April 23, 2004 Musk spent 7.5 million USD and became Chairman of Tesla Board 1.2 Tesla Motors Tesla Motors was set up in the heart of Silicon Valley in Palo Alto, CA in 2003 The firm was established with the commitment to develop only fully-electric vehicles Elon Musk, the billionaire CEO of the Tesla Motors, is one of the primary driving factors behind its success Tesla Motors unveiled the ultra-sporty Tesla Roadster at the SF International Auto Show in Nov 2006 While the model’s design was not unique, Tesla’s electric drivetrain technology was revolutionary It was the first vehicle to use lithium ion technology and was the first all-electric vehicle to travel more than 200 miles on a single charge Tesla proved that electric engines can be extremely powerful and can provide acceleration well in excess of their petrol powered rivals The base price of the car in USA was around $109,000 targeting the premium segment Sales volumes of electric and hybrid cars in the USA was significantly hit by the economic downturn of 2008 However sales picked up in 2012, when the country’s economy stabilized, governmental regulations shifted in favour of high efficiency vehicles and gasoline prices rose The Model S sedan, launched in June 2012, is the current flagship vehicle for Tesla It comes with options of a 60 or 85 kW battery pack, allowing a mileage of 208 to 265 miles It is priced between $70,000 and $100,000 in the USA, again targeting the premium segment 1.3 Evolution of Tesla 2006: (Tesla roadster) Tesla gained attention for the first time after the official presentation of the first all-electric sports car Tesla Roadster in July 2006 The car can travel 393 kilometers on a single charge while it takes three and a half hours to fully charge the battery It accelerates to 100 km/h in just 3.7 seconds The maximum speed is 201.1 km/h.Tesla Roadster uses an AC motor (alternating current motor) revealed directly from Tesla’s original design in 1882.The cost of the basic model was $ 109,000 The company stopped the production of Roadster in January 2012 During the period from 2008 to 2012 Tesla Motors has sold more than 2400 Roadster cars in 31 countries The release of a new generation of Roadster was announced in 2015 It is planned to be released in 2019 2009: (Model S) Tesla’s Model S prototype was shown at a press conference on 26 March 2009 The sedan production started in 2012 and deliveries to customers in June 2012 On a single charge of the 60 kWh battery capacity Model S can travel 426 km, and with a battery capacity of 85 kWh, the distance will increase to 510 kilometers In the most expensive configuration the car is able to accelerate to 100 km/h in 3.1 seconds Prices on Model S start from $ 75,000 2012: (Model X) Tesla Model X is a full-size crossover which was first shown in February 2012.The car is available in two versions: 90D and P90D The 90D version uses the battery capacity of 90 kWh and accelerates to 96 km/h in 4.8 seconds and is able to travel 410 kilometers on a single charge The P90D reaches 96 km/h in 3.8 seconds and with the optional Ludicrous Speed Upgrade package it takes just 3.2 seconds to get to 96 km/h The P90D version is faster than Lamborghini Gallardo LP570–4 or McLaren MP4–12C The maximum speed is limited by “electronics” (as in the Roadster) at around 250 km/h On a single charge the car can travel 500 kilometers 2015: (Autopilot) In October 2015 the “autopilot” feature was added to the updated firmware of Model S It can be used in cars manufactured after October 2014 as they are equipped with additional sensors (a camera mounted in the top of the windscreen, a forward radar in the lower front grille as well as ultrasonic sonar sensors in the front and rear bumpers) which provide a 360 degree buffer zone around the car 2016: (Model 3) Model was previously called Model E and in the original business plan it was listed under the code name Tesla BlueStar The current name was announced on Twitter on 16 July 2014 The car was be presented in 2016 The first deliveries of the car began in 2017 but, according to Musk, the company will be able to satisfy the expected demand only in 2020 The estimated cost in the US will be $ 35,000 The size of the Model will be 20 % less than of Model S and a single charge will last for 320 kilometers 2015: (Superchargers station) In order to use Tesla cars for long trips the construction of a network of “Superchargers” stations of fast charge began in 2012 By the end of 2015 there were 528 stations operation worldwide and having 3000 separate charges Currently stations mostly use solar energy which is supplied by SolarCity Later, all station will switch to solar energy 2015: (Powerwall) Besides vehicles Tesla Motors is engaged in the production of lithium-ion batteries designed for the conservation of energy for domestic use as well as for backup power Powerwall has two different models of and 10 kWh capacities The electricity will be enough to power the house during the evening and it will be charged by solar panels during the day There is also a Powerpack model with a capacity of 100 kWh: it is designed for commercial use and can be infinitely scalable 2019: (Model Y) Elon Musk unveiled Tesla's mid-size electric SUV, the Model Y, Thursday night in Hawthorne, Calif The most-affordable Model Y will have a base price of $39,000 and a 230-mile battery range, but customers will have to wait until at least 2021 to own one of the five-seater SUVs Tesla will first sell more expensive versions of the Model Y — with prices starting from $47,000 to $60,000, and offering more battery range Those will ship starting in 2020, according to the company.There are additional charges for Tesla's autopilot software, a third row of seats and colors other than black A panoramic glass roof comes standard ANALYSIS TESLA MOTORS 2.1 Identifying core competencies and capabilities of Tesla Motors  Core competencies - Powertrain engineering - Vehicle engineering o Innovative manufacturing o Energy storage - Computer aided design - Crash test simulation  Core Products - Batteries and engine  Business units  Products - Electric car (Model 3XSY), phone chargers, wireless smartphone chargers… 2.2 Business model Tesla took a unique approach to getting its first vehicle in the market Instead of trying to build a relatively affordable car that it could mass produce and market, it took the opposite approach, focusing instead of creating a compelling car So Tesla delivered to the market the first high-performance electric luxury sport car, the Tesla Roadster The company sold approximately 2,500 Roadsters before ending production in January 2012 Direct sales Unlike other car manufacturers who sell through franchised dealerships, Tesla uses direct sales It has created an international network of company-owned showrooms and galleries, mostly in prominent urban centers around the world Service Tesla has combined many sales centers with service centers They believe that opening a service center in a new area corresponds with increased customer demand Customers can charge or service their vehicles at the service centers or the Service Plus locations Also, in certain areas, Tesla employs what it calls Tesla Rangers – mobile technicians who can service vehicles from your house Sometimes, no onsite technician is required at all The Model S can wirelessly upload data so technicians can view and fix some problems online without ever needing to physically touch the car Supercharger network Tesla has created its own network of Supercharger stations, places where drivers can fully charge their Tesla vehicles in about 30 minutes for free The premise behind building and owning these stations is to speed up the rate of adoption for electric cars Without the ability to charge on the go (similar to the concept of getting gasoline while driving), electric cars face a huge obstacle to mass adoption Tesla will continue adding to the network of Supercharger stations in the United States, Europe, and Asia 2.3 Tesla Motor SWOT 2.3.1 External analysis 2.3.1.1 Porter’s five force model A Competitive Rivalry or Competition with Tesla, Inc (Strong Force) Tesla, Inc operates in a highly competitive market This aspect of the Five Forces Analysis outlines the influence of competition on the automotive and energy solutions industry environment In this case of Tesla, the external factors and their intensities responsible for the strong force of competitive rivalry are as follows: - Small number of firms (weak force) - High aggressiveness of firms (strong force) - Low switching costs (strong force) There are only a small number of firms operating in the automotive market In Porter’s Five Forces analysis framework, this external factor limits the effect of competition on companies like Tesla, Inc However, these firms are generally aggressive in innovating and promoting their products For example, large automotive companies have aggressive marketing campaigns Tesla’s marketing mix or 4Ps partly meets such aggressiveness, which strengthens the effects of competitors against the business Also, the low impediments for customers to buy cars from other manufacturers (low switching costs) further strengthen the force of competition This aspect of the Five Forces analysis of Tesla Inc points to competitive rivalry as a high-priority strategic management consideration in the automotive and energy solutions industry environment B Bargaining Power of Tesla’s Customers/Buyers (Moderate Force) The influence of customers on firms and the automotive, battery, and solar panel industry environment is accounted for in this aspect of the Five Forces Analysis Tesla’s customers are a direct factor that determines the company’s sales revenues The following external factors and their intensities maintain the moderate force of the bargaining power of customers on the company: - Low switching costs (strong force) - Moderate substitute availability (moderate force) - Low volume of purchases (weak force) Low switching costs reduce barriers for Tesla customers to purchase cars from other providers In the context of this Porter’s Five Forces analysis, this external factor imposes a strong force against the company and other players in the automotive industry environment However, the availability of substitutes is only moderate in many cases, thereby limiting customers’ bargaining power against Tesla Inc For example, many customers in suburban areas have limited access to public transportation, making it more practical to drive their own car In addition, the low volume of purchases (each customer buys and keeps only one or a few cars) reduces the influence of customers on Tesla Thus, the intensities of the external factors in this aspect of the Five Forces analysis reflect the bargaining power of customers as a moderate force and a secondary management priority This prioritization is reflected in Tesla Inc.’s generic strategy and intensive strategies C Bargaining Power of Tesla’s Suppliers (Moderate Force) Tesla Inc.’s business depends on the reliability of suppliers This aspect of the Five Forces Analysis shows how suppliers shape the industry environment by influencing the availability of materials that firms need The intensities of the external factors that create the moderate force of the bargaining power of Tesla’s suppliers are as follows: - Moderate forward integration (moderate force) - Moderate size of suppliers (moderate force) - Moderate supply level (moderate force) Tesla Inc.’s suppliers have a low level of forward integration This external factor refers to suppliers’ limited control in the distribution and sale of their products For example, some suppliers use third parties to sell their materials to Tesla, while others directly transact with the company In the framework of Porter’s Five Forces analysis, this external factor imposes a moderate force on the corporation In addition, most of these suppliers are moderately sized, thereby having limited influence on the automotive industry environment Another external factor is the moderate level of supply, which empowers suppliers to affect Tesla, but only to a limited degree This aspect of this Porter’s Five Forces analysis of Tesla Inc indicates the bargaining power of suppliers as a secondary strategic management priority D Threat of Substitutes or Substitution (Moderate Force) Tesla, Inc experiences the impact of substitutes on the automotive and energy solutions industry environment In this aspect of the Five Forces Analysis, the intensities of the external factors that lead to the moderate force of the threat of substitution against the company are considered, as follows: - Low switching costs (strong force) - Moderate substitute availability (moderate force) - Moderate performance of substitutes (moderate force) As pointed out in the other aspects of this Porter’s Five Forces analysis of Tesla Inc., low switching costs enable competition In this external analysis case, the low switching costs enable substitutes, such as public transportation, to easily attract customers This external factor imposes a strong force against Tesla’s industry environment However, the moderate availability of substitutes limits such influence of suppliers For example, customers have only a moderate and limited number of substitute options in the market In relation, many substitutes have only a moderate level of performance in satisfying customers’ practical needs For instance, public transportation is not as versatile as a private car This condition further limits substitutes’ force against Tesla In this aspect of the Five Forces analysis of Tesla, Inc., the external factors point to the threat of substitution as a secondary management consideration in the company’s strategies E Threat of New Entrants or New Entry (Weak Force) 10 Automotive Sales: $ 17.63 Billion Leasing: $ 883.5 Million Energy generation and storage $ 1.65 Billion Services and other $ 1.39 Billion Successful companies have a clearly defined strategy, supported with their unique value proposition (Collis& Rukstad, 2008) The strategy of Tesla, as shared by Elon Musk is “to enter at the high end of the market, where customers are prepared to pay a premium, and then drive down market as fast as possible to higher unit volume and lower prices with each successive model” (2006) The above mentioned strategy statement is comprehensive as it clearly defines the company’s objective, scope and means to accomplish the objective (Collis & Rukstad, 2008) Although Tesla is not yet profitable, the company’s jump in revenue, increase in gross profit margins and the predicted success of Model (based on existing pre orders), suggest that Tesla’s steady strategic approach has offered advantage The company’s actions are aligned with their mission and long term strategy Tesla understands that its value proposition lies in its proprietary disruptive technology Hence, to keep up the growth all free cash flow is plowed back into R&D to drive down the costs and bring the follow on producs to market as fast as possible When someone buys the Tesla Roadster sports car, they are actually helping pay for development of the low cost family car with competitive innovative technology Tesla’s technological innovation based blue ocean strategy has potential but so far has been very expensive They remain unprofitable, are still losing money on each car and $5 billion investment in Giga factory has not gone down well with all stakeholders The company intends to tremendously bring down production costs once the Giga-factory works in full 17 capacity but that requires patience The current valuations supporting the $25 billion market capitalization ae based on future expectations Therefore, despite being the technological pioneer and global leader in the electric vehicle industry, Tesla’s remains a speculative stock I personally think that the high end disruptive strategy of entering through premium customer base, creating an aspirational brand and then targeting the mass market segment by launching an affordable yet elegant product is a strong strategy However, I think a $5 billion investment in a Giga factory at this stage when the company is not yet profitable is a risky step Outsourcing and collaborations for mass battery production would have been a safer approach Currently Tesla is selling only through its own stores and services through its owned super charger and battery swapping stations With global expansion and volume sales strategy on cards, it is important for them to look at franchising and partnership options for sales and service Tesla has a mammoth goal of achieving a considerable market share before any new imitation or competition hits the market (Dyer & Bryce, 2014) Musk’s goal of creating and selling 500,000 cars in a year needs to be realized and a lot rides on the Model car If Tesla cannot achieve its ambitious goals it could still emerge as a successful niche player in the ‘performance green motors’ industry without creating much competition / interest from the big players like Toyota, GM or Ford However, if its strategy and business model is a success, then with considerable market share and lack of good imitation, Tesla could create some real change in the automobile industry leaving the big sharks behind (Dyer & Bryce, 2014 18 2.5 Tesla motor technology strategy 2.5.1 Tesla’s secret weapn: intense focus on batteries The truck can go up to 800km at maximum weight at highway speed, said the company’s CEO Elon Musk, without specifying the size of the payload Musk said the Class vehicle, the heaviest weight classification for trucks, takes 30 minutes to recharge the battery enough to go nearly 650km, and that Tesla would build a global, solar-powered network of “megachargers” The company’s other unveiling was its new Roadster, a sports car with a removable glass roof and an updated version of Tesla’s first production vehicle It can seat four and travel 1,000km on a single charge, a new record for an electric vehicle, Musk said It can go from to 100km/h in 1.9 seconds with a maximum speed of over 400km/h, which would make it the fastest car in general production Battery’s advantages “Tesla still uses commodity cylindrical cells, whereas other car manufacturers still use prismatic (Chevy Bolt) and pouch (Nissan LEAF) cells,” Thomas writes In fact, Tesla is no longer using off-the-shelf “laptop batteries” – it has worked with partner Panasonic to develop new cells optimized for its vehicles (JOINT VENTURE) However, it has stuck with the strategy of assembling large numbers of small cylindrical cells into a pack The Chevy Bolt’s 60 kWh battery pack has 288 cells The Nissan LEAF’s pack has 192 Tesla’s packs require many more cells – a Model with a 50 kWh battery pack has 2,976 cells, and a Model S or X with a 100 kWh pack requires a whopping 8,256 Obviously the smaller cells are cheaper, but it stands to reason that it must be more difficult, and hence costlier, to assemble them into a pack 19 Figure The image compares the approximate size of popular plug-in vehicles on Tesla vehicles and other models Therein lies a mystery – Tesla is widely believed to have the lowest battery cost in the industry But how does it manage to assemble all those tiny cells into a pack economically? As far as Thomas has been able to tell, no one outside the company knows Tesla protect their intellectual property by holding it as a trade secret Supercharger station Tesla Motors has 1,441 Supercharger Stations with 12,888 Superchargers to get faster charging, no more power sharing Specilally, the appearance of V3 supper charging V3 is a completely new architecture for Supercharging A new 1MW power cabinet with a similar design to our utility-scale products supports peak rates of up to 250kW per car At this rate, a Model Long Range operating at peak efficiency can recover up to 75 miles of charge in minutes and charge at rates of up to 1,000 miles per hour Combined with other improvements we’re announcing today, V3 Supercharging will ultimately cut the amount of time customers spend charging by an average of 50%, as modeled on our fleet data Supercharger stations with V3’s new power electronics are designed to enable any 20 owner to charge at the full power their battery can take – no more splitting power with a vehicle in the stall next to you With these significant technical improvements, we anticipate the typical charging time at a V3 Supercharger will drop to around 15 minutes Figure Tesla’s supercharger station in California Figure Tesla’s supercharger station in the world 2.5.2 Engine block Figure Three-phase electric motor used on Tesla vehicles Instead of using an internal combustion engine (Internal Combustion Engine), Tesla equips its car with an electrically powered engine block Electric motor has outstanding advantages in control ability Allows the use of advanced control methods to control 21 motors, thereby improving the kinetic quality of electric cars Compared to the internal combustion engine, the three-phase electric motor used on Tesla models has more outstanding advantages in many aspects (performance, weight, engine stability, fuel consumption) materials, emissions problems, ) While the internal combustion engine has many different physical parts, this makes it difficult and costly to carry out maintenance and repair for the engine every time something goes wrong The mass of the internal combustion engine blocks an average of about 180 kg but the electric motor is only approximately 31.8 kg Friendly engine, low fuel consumption Figure The image compares the mass and energy of the electric motor and the internal combustion engine The average fuel consumption cost of an electric motor used on Tesla is about $0.03/mile less than an internal combustion engine that costs $0.1/mile Figure The image compares fuel consumption costs between electric cars and fuel-powered vehicles 22 Although less fuel-efficient than internal combustion engines, it does not mean that the performance of the electric engine will be reduced compared to an internal combustion engine The electric motor always gives relatively perfect performance at or above 90% in all cycles while in the internal combustion engine only the highest possible range is 40% or 45% for those The most optimal engine And only maximum performance is achieved in a short range of rewinding machines The maximum speed of the electric motor equipped with Tesla can reach 18000 rpm, which is superior to the internal combustion engine (only 2000- 4000 rpm) Figure Compare speed range between internal combustion engine and three-phase electric motor 2.5.3 Autopilot System Autopilot is a computer system integrated into Tesla's cars, providing semi-automatic capabilities for these models When the system is activated, Tesla cars can adjust the speed, change lanes and park themselves without the driver's assistance Autopilot selfdrive system integrated in its cars can be driven on highways and in parking lots At the same time, every automaker's car has been integrated with the necessary hardware and will be activated when the software as well as the law allows Tesla introduced Autopilot in 2015, which will bring self-driving capabilities to its cars in certain situations Tesla 23 continued to upgrade new hardware on all Tesla cars to support the new version of this autopilot system, now called the new name Enhanced Autopilot Figure Auto drive mode control panel used on Tesla cars The impressive features that Tesla's Autopilot system can perform at the present time, and features that may appear in the future: - Tesla cars manufactured from October 2016 onwards are equipped with cameras with 360-degree coverage around the car Each camera has a vision of up to 250m - Besides, Tesla also integrates 12 ultrasonic sensors to identify and avoid hard and soft objects - Tesla cars have a radar system that looks through fog, heavy rain, dust and even a car running ahead -All new Tesla cars have Enhanced Autopilot compatible hardware When the vehicle runs on the highway, Enhanced Autopilot will be able to control vehicle speed based on surrounding traffic conditions, determine whether to keep or change lanes, move between highways and find a way out of the highway - This self-driving system can also handle curves, redirects or roads with many other complex shapes - But at the present time, Tesla cars are still not fully automated, and Autopilot still needs to make sure that the driver is placing his hand on the steering 24 wheel If the system detects the driver leaving the steering wheel for too long, it will automatically pull the driver back and park the car before activating the system again - After leaving the highway, the vehicle will automatically transfer control to the driver However, once it arrives, the vehicle will automatically determine the available parking spots and drive the vehicle to a parking position in a parallel or perpendicular manner - You can call the car out or into the garage without having to sit in the car TESLA AND COMPETITORS 3.1 Competitors Tesla will continue to experience direct competition from other BEV entrants, indirect competition from existing and emerging plug-in hybrid vehicle manufacturers and competition from BEV ‘substitutes’ including gasoline hybrid and gasoline powered vehicles Tesla will begin seeing plenty of competition in the months and years to come Major competitors for Tesla include traditional auto companies such as: General Motors (GM): Chevrolet was the first to copy the Tesla formula with its 2017 Bolt EV getting 238 miles per charge During a media event at the North American International Auto Show earlier this month, parent GM announced Cadillac will be next to go long-range for 2021, using a platform that could eventually be used by dozens of other models Nissan Nissan unveiled a 226-mile version of the Leaf at the Consumer Electronics Show in Las Vegas this month It could appeal to buyers who’ve been waiting for the long-promised $35,000 base Tesla Model – the current starting price $44,000; Meanwhile, Nissan will offer eight all-electric models by 2022, with its high-line Infiniti brand switching entirely to either plug-ins or BEVs 25 ... Tesla electric vehicle overview. " AUTOMOTIVE INDUSTRY AND TESLA MOTORS 1.1 History of the company - Tesla is a name taken from an American inventor (Tesla Nikola), who was born in 1856 in 1943 Tesla. .. of Tesla Board 1.2 Tesla Motors Tesla Motors was set up in the heart of Silicon Valley in Palo Alto, CA in 2003 The firm was established with the commitment to develop only fully -electric vehicles... model’s design was not unique, Tesla? ??s electric drivetrain technology was revolutionary It was the first vehicle to use lithium ion technology and was the first all -electric vehicle to travel more than