Tesla has a sustainable business model
How the rise of Tesla is changing entire industries
Tesla Motors is currently the phenomenon on Wall Street. Within a week, the company was able to collect over 300,000 pre-orders for its new Model 3 electric car - many observers already see this as the beginning of a paradigm shift in the auto industry.
But Tesla Motors is not only likely to change the automotive industry with its uncompromising strategy for electric cars, other branches of industry will also be permanently affected by the rise of Tesla Motors. This, in turn, is of interest to investors who are still invested in these industrial sectors.
The rise of Tesla Motors and its impact on the oil industry
Every electric car Tesla Motors sells hits the oil industry. The reason: Tesla drivers no longer visit traditional gas stations, but instead charge at fast charging stations (superchargers) or other electrical charging stations.
To date, Tesla has sold more than 100,000 electric cars worldwide. Assuming that every Tesla driver covers 10,000 miles (16,000 kilometers) a year, that would save 400 gallons or 1,500 liters of gasoline per year, assuming average consumption.
With 100,000 Teslas on the road, that would save 40 million gallons of gasoline (151 million liters) per year, which would mean losing around $ 100 million in revenue to the oil industry each year. And this should only be the beginning, because other manufacturers are of course also entering the market with electric cars.
Tesla doesn't care about the advertising industry
The rise of Tesla Motors also has far-reaching consequences for the advertising industry, because Tesla Motors has a completely different advertising strategy than the majority of automakers.
The reason: Tesla boss Elon Musk considers classic advertising to be ineffective. Tesla advertising on TV is in vain, instead Tesla wants to invest every remaining dollar in improving its products, as the Tesla boss emphasizes again and again. The Tesla founder sees greater added value for his customers in this.
This strategy should also have an impact on the advertising industry, after all, car manufacturers are among the largest advertisers. In 2015, three of the top 10 largest advertisers came from the auto industry. These were General Motors ($ 3.1 billion in ad spend), Ford ($ 2.5 billion), and Fiat Chrysler ($ 2.2 billion).
Tesla is taking a different approach here and prefers to forego high advertising spending, which could mean that the advertising industry could lose billions in the future.
Tesla relies on direct sales - dealers are left behind
Disputes with the US Association of Car Dealers are now the order of the day. The reason: Tesla Motors does without a dealer network and prefers to sell its cars directly to end customers via its own Tesla stores.
In some US states such as Texas, New Jersey or West Virginia, Tesla is still prohibited from selling its cars directly to end customers. No wonder, because every sale of a Tesla car represents a loss for the profit margin of the car dealership and at the same time threatens the decades-old sales structures in the auto industry.
Tesla finances itself on the capital market
And there is one more procedure that distinguishes Tesla Motors from other manufacturers. Tesla is taking pre-orders for a reservation fee to produce vehicles in the future.
This means that Tesla initially has a "liability" towards its customers, but at the same time Tesla can refinance itself cheaply without the manufacturer having to be active on the capital market. With the Tesla Model 3 (400,000 pre-orders, US $ 1,000 reservation fee), for example, the electric car manufacturer can now fall back on around US $ 400 million - without having to pay interest or fees to Wall Street.
Conclusion: Tesla Motors is shaking the establishment
The rise of Tesla Motors is having an impact on several industries that are facing major changes over the next few years. Investors are therefore well advised to take a closer look at the previous business models and industries in order to avoid expensive bad investments.
The actual innovation from Tesla Motors goes beyond the electric car and includes in particular the alternative business model with which Tesla gains competitive advantages in the market and thus puts established car manufacturers under pressure.
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