Inability of its Production Capacity to Meet Increasing Demand: Tesla

Final Project – Tesla
Introduction
Right now more and more people attach great importance to environmental protection, instead of traditional gasoline and diesel vehicles they prefer to use plug-in hybrids and battery-electric vehicles. According to IEA (2021) in 2020, there were over 10 million electric cars in the world, an increase of 43% compared to 2019. Although the market share of electric cars is only 1%, it is the future. The leading enterprise in the electric vehicle industry is Tesla and no one doubts that it is a successful company. Nevertheless, many issues appear during the development of Tesla and some of them are very serious. In the report, we will first talk about the background of Tesla and a brief introduction of its CEO Elon Musk because he affects Tesla a lot. Secondly, we will talk about what issues Tesla is facing, what causes these issues, what are the impacts, and why these issues are serious. Lastly, we will give our recommendations and the reasons to support our decisions.
Tesla is an American electric car manufacturer and clean energy company, it was founded in 2003 by Martin Eberhard and Marc Tarpenning. In 2021 Tesla becomes the largest electric car manufacturer and the first company to sell 1 million electric cars globally. The main business of Tesla can be divided into two parts. The first part is about selling electric vehicles. Just like what we talked about above Tesla now is the largest electric car manufacturer. The second part is about battery energy storage. Tesla uses its advanced technology of battery storage and solar power to create a subsidiary called Tesla Energy and now Tesla Energy is one of the largest suppliers of battery energy storage systems in the world.
Like Pauline Meyer (2018) says the organizational structure of Tesla is functional or you can call it U-Form. This organizational structure is very traditional, it divides the company into different departments and each department is directly managed by senior level. In U-form companies, they use centralization to manage the incorporation, the whole company is controlled by a central group. There are six departments in Tesla, the first one is Chairman & Chief Executive Officer. They have the top positions in the functional structure, for Chairman he can manage the board members, and for the CEO he can manage the senior executives. The second one is Finance. This department helps the company manage the money, handle the accounts and make plans for expenditure. The third one is Technology. For companies like Tesla, technology is very important because they need to use new technologies to compete with other rivals. This department’s job is improving battery tech, upgrading the software of Tesla’s vehicles, and developing the technology of full self-driving which is called Autopilot. The fourth one is Global Sales and Service. This department’s job is providing after-sales service and sales all over the world. Tesla’s Global sales is a very important business, for example in 2020 it sold 137000 electric vehicles in China and 206000 in the USA. The fifth one is Engineering. For engineers, their job is to design the vehicle. Because all models of Tesla’s cars are battery-electric, their desig...