Tesla analysis by Ansoff´s Matrix analysis Management Research Paper

TESLA ANALYSIS BY ANSOFF’S MATRIX ANALYSIS
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Tesla Analysis by Ansoff’s Matrix Analysis
Market Development
Tesla is already operational in China. However, like any company with competitors, it has to continue gaining the trust of the customers. It also has to ensure that it remains the prime choice for a significant portion of the population as it seeks to make its mark in the market. Currently, Tesla is trying to push sales for its Model 3 in China. This car has grown in its appeal to different demographics and people at different income levels.
Tesla already began work on the gigafactory in China, which has already started churning out Model 3s. But could having more plants in the country help enhance the company’s appeal to the locals? Can the company be able to increase product awareness by having more plants in China?
Diversification
Diversification mainly involves the development of new products to capture new markets. Currently, A Tesla Model 3 sells for 291,800 yuan, which is about $41,318 (He, 2020). This is quite low, considering a Model 3 Long Ranger in the U.S. costs $48,990 (Trotter, 2020). With such a price, Tesla can attract more clients. However, these numbers are still quite high for someone in the lower-middle-income class. Individuals earning $70,000 a year would need to spend more than half their year’s wage to acquire a new Model 3 Tesla. Only those in the middle and upper-middle-income class can acquire a Tesla Model 3 somewhat comfortably. As Tesla’s appeal in China grows, it makes sense to consider models that are not as pricy as the Model 3. With the gigafactory already in China, maybe there is room for diversification as the company looks to attract more customers.
Market Penetration
Tesla is making great strides to try and penetrate the Chinese market. With its sleek-looking Model 3s, the company has already shown that it is there to stay. However, Tesla could still do more to expand its reach in the Chinese market. Growth is indeed being witnessed in the country as more customers are falling in love with the Model 3. But, there is much ground to cover, and Tesla can cover this ground through various strategies to help penetrate the market further.
The company could consider reducing the prices further. Price reduction strategy makes products affordable to individuals in lower-income classes. There is also the issue of making the Model 3 (made in China models) be more locally owned. Companies from outside China have had a difficult time trying to penetrate the Chinese market. With a strategy that makes Tesla products in China more local, the appeal could grow as it will change face as a home company.
Product Development
Product development mainly involves the development of new products to help expand sales in existing markets. Tesla’s market in China i...