Tesla becomes world’s most valuable automaker

Earlier this week, Tesla overtook Toyota as the world’s most valuable automaker.

● Shares of Tesla have more than doubled since the start of 2020, giving it a market capitalization of $207.2 billion, surpassing Toyota’s $201.9 billion

● Additionally, Toyota has forecast an 80% plunge in profit this year, and expected a further decline in the first half of 2020, due to the impact of covid-19 on the auto industry
● Tesla has produced 103,000 vehicles in the first quarter of 2020, which is just 4% of the 2.4 million cars made by Toyota.

● In January, Tesla became the world’s second most valuable automaker, after surpassing the German car manufacturer Volkswagen AG

The Company:

● Tesla, the American electric vehicle and clean energy based company currently and was founded in July 2003, in California, U.S.

● As per Statista, over 2019, the market share of Tesla grew to 1.35% in the U.S. automotive market

● In the elective vehicle (EV) market, Tesla is the market leader in the battery- electric car sales in the U.S.

● Value sales in the selected segment of the make Tesla is projected to reach US$13,512 million in 2020.

● With a revenue of US$10,898 million, the United States is expected to be the most important market for Tesla in 2020.

The Brand:

● Brand icons and brand leader: Apart from the presence of brand icons like a widely recognised logo and a brand name, Tesla is also known for its charismatic CEO Elon Musk, who acts as a brand leader.

In terms of brand recall, what Elon Musk is doing for Tesla is similar to what Steve Jobs did for Apple. These iconic brand leaders and their public images have had a big impact on how the brand is perceived.

● Brand Personality: Tesla has an exciting, visionary, charismatic, courageous and spiritual personality

● Brand Archetypes: While Elon Musk shares the Magician brand archetype, Tesla as a brand has a ruler archetype- who are looking to crush their competitors and dominate the space they are in.

The Strategy:

Worldwide, Tesla delivered some 367,000 vehicles in 2019. The global market for electric vehicles is projected to increase to over 567 billion U.S. dollars by 2025.

What made Tesla different?

● Unlike other car manufacturers who sell through franchised dealerships, Tesla uses direct sales. Tesla has 429 locations around the world as of the end of Q4 2019 and also allowed consumers to purchase online

● 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

● Tesla has created its own network of Supercharger stations, places where drivers can fully charge their Tesla vehicles in about 30 minutes for free.

Tesla has transformed the automotive industry, an industry that heavily relied on the internal combustion engines for more than 130 years. Tesla’s mission has been to accelerate the world’s transition to sustainable energy and it will be interesting to see which international markets they expand to, in the future.

Written by- Juie S. Shah