With factories opening up in China and Europe, as well as a sixth automobile model released earlier this month, is Tesla’s new long-term plan a game-changer?
Whether you are a die-hard, bullish Tesla (NASDAQ: TSLA) superfan or a crusading anti-Musk skeptic, there’s one thing we can all agree on: the electric-car manufacturer and its eccentric CEO are never boring.
Back in October, the company reported that it had returned to profitability — albeit marginally — and also announced that it had made record quarterly deliveries with 97,000. In a year that has seen Tesla’s stock drop roughly 5% year-to-date through October, this is a good sign.
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With this in mind, could the building of two new Gigafactories (Tesla production plants) in Germany and Shanghai be signs that Tesla is about to take the next step in its business life-cycle? Let’s take a look at the implications.
Tesla’s International Expansion
Constructed in just 168 days, Tesla’s new Shanghai Gigafactory, which began trial production last month, is expected to crank out roughly 150,000 models per year. Investors will be happy to hear this, considering the company has a long history of failing to reach production targets.
Not only this, but Elon Musk has also stated that the company is still on track to sell 360,000 Tesla models by the end of the year, which would see his company grind out a record-smashing 105,000 cars in the final 3 months of 2019.
Enabling production to be met is but one benefit from the new Shanghai plant! China is also the largest automobile market on the planet, despite growing fears of a slow-down in the industry. Until this year, China required foreign carmakers to link up with domestic ones to manufacture in the country, making Tesla the first company to take advantage of this, while also avoiding a 25% import duty.
On top of this, China announced back in August that it would exempt Tesla Model 3, Model S and Model X cars from its proposed auto tariffs, which will resume in December if a trade deal is not met between the U.S. and China. Though this would not be necessary anyway with production now in Shanghai, it does highlight the Chinese government’s willingness to work with Tesla, and even help.
With Tesla sales in China up more than 175% on last year, it looks as if Musk is in a good position to shore up the company’s status in the much-sought-after market of China.
Step 2: Write a response to the question.
Use a word processor to write a 4 – 5 page response to these questions in paragraph format:
You are a recent graduate from University with a minor in Mandarin. You are an American and you have moved to Shanghai, China where you have been hired as the project manager for Tesla run by the Chinese. The employees you will be in charge of will be mostly Chinese and men.
- Articulate your own culture from the perspective of social, political, economic, & intergroup relations. How do these factors influence business trade with China?
- Articulate the social, political, economic, & intergroup relations perspective of the Chinese culture. How do these factors influence business trade with the US?
- Identify the set of behaviors you might need to adapt when doing business in China. In addition, identify the cultural sensitive adjustment options you’ll have to consider.
- Identify the differences between your culture and the Chinese culture, also identify the step you would take to avoid labeling your culture as superior to the Chinese culture.
- Identify a set of steps you’ll take to analyze the dynamics in an interpersonal or intergroup transnational setting.
- Identify the key adaptive actions and behaviors you might use in this transnational business setting. In addition, articulate a comprehensive process in which you might internalize these actions and behaviors.