Industry case analysis

: Tesla’s strategy towards mass production of electric vehicles

Abstract

This thesis examines whether Tesla possesses sustainable competitive advantages in the mass production of electric vehicles over its German competitors. Thus, it seeks to decrease the two identified research gaps of Tesla’s production strategy and of Tesla’s competitive comparison to the German automotive industry which is substantially ramping up production of electric vehicles itself. To examine this coherence, the most appropriate method of analysis is found to be the examination according to Barneys VRIO framework which defines the four criteria of value, rarity, inimitability and organization for a competitive advantage to be classified as sustainable. The data to perform this analysis was collected using a survey with 71 respondents and 10 semi-structured interviews with both groups being composed of Tesla employees and employees of the most relevant German competitors BMW, Mercedes-Benz and Volkswagen. The survey found a total of seven relevant competitive advantages, Tesla possesses towards the mass production of electric vehicles over its German competitors. These competitive advantages are then quantitatively assessed by the survey results on the VRIO framework and qualitatively assessed through the information provided by the expert interviews. This combination of analytical methods not only leads to the classification of five competitive advantages as temporary but also to the classification of two as sustainable competitive advantages: Firstly, Tesla’s speed & agility which refers to the company’s high operating & decision-making speed as well as fast construction & commission of new factories. Secondly, Tesla’s vertical backward integration of component manufacturing and future in-house battery cell production.

Date of Award	28 Jun 2022
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Peter V. Rajsingh (Supervisor)