Tesla, Inc., is the world-renowned electric car manufacturing company based in California, USA. Other than electric vehicles, the company also delivers lithium-ion battery energy storage and solar panels. Some of the popular vehicles of Tesla in the market are the Model S, Model X and Model 3. Named after the famous electrical engineer Nikola Tesla, the company is aimed at developing electric that can be easily afforded by common people. Model S of the company crossed 200,000 sales at the end of 2017 and was the best-selling electric car in the world in 2015 and 2016.
Earlier in August 2018, Elon Musk thought of taking Tesla to private from its current public holdings, which was dropped recently knowing that taking the company to private would be relatively difficult than what he has imagined. He currently wants to keep the company in public listing and mentioned that the organization needs to focus on five different areas to increase its market presence. Below mentioned are those five challenges that Elon Musk believes to be addressed soon.
Increase the car production
Elon Musk thinks this as the most significant thing on his list and the most difficult to achieve. In June 2017, the company has finally achieved its delayed goal of manufacturing 5,000 units of Model 3 vehicles per week. He now wants to maintain this level and even increase it further to prove that it didn’t happen by chance. Several people have paid USD 1,000 to the company in order to get their Model 3 vehicle. Few people have waited since the first booking of these cars, which was opened in April 2016. It is essential for the company to deliver the products on time to maintain the customer relationship.
Maintain financial stability
The company has to hit its production targets to generate profitable revenue. It is estimated that the automobile maker would face around USD 1.2 billion debt by early 2019. On the other hand, it is planning to launch its USD 2 billion plant in China, which is essential for its expansion and capitalize on the strong Chinese market. Musk argues that the increasing sales of Model 3 will create enough profits for Tesla by the end of 2018. He firmly believes that without financial stability they cannot achieve their mission of advancing sustainable energy.
Handle the existing lawsuits
As soon Elon Musk revealed his interest to go private, two shareholders of Tesla filed lawsuits saying that his ‘funding secured’ claim was false and a trick to manipulate the company stocks. Several reports also mentioned that the Securities and Exchange Commission (SEC) is also investigating the claim to check whether it violated any security policies. However, the SEC or the company has commented on those reports and lawsuits, which must be taken care.
Improve investors trust
It is with the help of investors Tesla accelerated its growth rate in the recent years. But recent announcement of going private has created doubts for the investors regarding the ability of Musk to take the company private at a share cost of USD 420. It is now necessary for the CEO to rebuild that trust again and recover the stock from its 20% fall, which can be achieved by rapid production of cars and increase in the profits.
Identify the correct help
Musk has been pushed to employ an efficient second in line command to monitor the daily activities of the company. It is those executives that help any organization in their business expansion. For instance, Sheryl Sandberg helped Mark Zuckerberg in making Facebook a super success, and Eric Schmidt helped Google founders Larry Page and Sergey Brin in taking the company public. It is a complex task to find the right candidate for the position as many executives have joined and left the company, failed to work under Elon Musk.
Therefore, the company according to Chairman and CEO, Elon Musk, must address the above challenges to regain its market trust and profits in the coming years.