Tesla: declining or on the verge of success?

By Charlie Mascia

The technology startup Tesla Motors has risen to a position of fame in American culture, but do they deserve the praise? In the public’s eye the company has been a phenomenal success, epitomizing Silicon Valley growth, especially since the release of the flagship Roadster. However, their strategies have proven at to be frequently counterproductive. As the company battles bankruptcy and high spending rates, they dangle on the precipice of failure.

As a corporation looking to manufacture and sell a completely new product in a market that has been dominated by uniformity and importation, Tesla faces steep opposition in accomplishing their goal. The automaker is currently propped up on government loans from the Department of Energy and an extremely speculative stock which began from their initial public offering in 2010. Since the corporations inception they have suffered huge downsizing and unruly spending which has far exceeded their budget.

Despite Tesla’s perpetual financial problems, many praise the company and its initiative to make electric vehicles more viable in today’s market.

Tesla currently offers the Model S and Model X, which both sell for close to $100,000. They are phenomenal vehicles which exemplify both style, performance, and a keen eye for technology. Featuring self driving, Heads Up Display, and a minimalistic interior, they clearly have an eye for detail. Despite the lux and intrigue in such a classy vehicle, one must be critical of Tesla. They have designed a supercharged, technologically advanced, A+ car for the middle aged wealthy individual, but this isn’t Tesla’s target demographic; the company wants to appeal to young, environmentally aware, tech-savvy Americans. Tesla’s market base is clear from their millennial stuffed release parties, to their pun heavy, grammar-lacking tweets. Tesla needs a car that can be affordable for their target demographic.

Tesla Model X: Courtesy of fortune.com
Tesla Model X: Courtesy of fortune.com

Tesla has answered the request with the upcoming release of the Tesla Model 3. “Super next level” was Elon Musk’s, the company’s billionaire CEO, description of the new vehicle at its release. Priced at a more reasonable $35,000 it still remains out of reach for many young consumers in the automobile market. However, this addition to the Tesla inventory bridges a huge gap between the highly priced other options. Set to become the new flagship vehicle in Tesla’s line, the marketing advertises value over engineering.

“You will not be able to buy a better car for $35,000 – or even close – even if you get no options,” Musk said in the reveal of the Model 3.

Tesla is on the verge of complete domination of American auto markets, the question remains: will the Model 3 be the catalyst that pushes them into the major league? The Model 3 poses a unique opportunity for the company to grow, but investors and consumers won’t buy in unless the innovation is accessible, while maintaining the Tesla quality.

Leave a Reply