STRATEGIC MANAGEMENT

CASE ANALYSIS
Doubling Down: Elon Musk’s Big Bets in 2022

SUBMITTED BY
RHEA REJITH
P21195
PGDM B
CASE ANALYSIS: Doubling Down: Elon Musk’s Big Bets in 2022

This case basically talks about Elon Musk and the ventures of his that makes him a phenomenal
leader. He as a leader promised Tesla would be the fully automated car sharing service. He
constructed various things including giant battery factory at the largest building in the world.
They also produced 105 GWh of battery cells per year. Tesla wanted to acquire rooftop solar
installations which would show their motto which was accelerating the advent of sustainable
energy. Despite of all this Tesla and SolarCity has been unprofitable. So as to end this error of
unprofitability Elon Musk was asked to act fast. Elon Musk always considered Tesla the one
brand who would put this industry forward. The company as of now has faced such gravel
situations so as to analyze the situation and come to conclusion analysis of the pas and present
incident should take place. The company should be able to maintain a growth and should be able
to get high capital for the functions so as to achieve that they should be able to acquire
stakeholders that would be able to maintain and understand the motive and also who would be
able to understand the standards.

Companies plans where to build sports car and to use that money to build an affordable car and
use the money that they get to build a more affordable car. Tesla’s first model was released as
Roadster with high performance and was named as a sports car. Second car was a sedan car
named Model S. from this they jumped into another model named Model X which was much
cheaper. After that they had a new feature launch of auto pilot. These steps created a buzz and
immense profits. But with this even there was immense backlash with managers leaving the
company.

The company should let the stakeholders know of their present situation and should also be able
to communicate the needs of the company as of now. During the launch of Tesla the investors
gained about 270 million which was a 100 million less. Whereas the next year they produced
more loss which intimidated for a change of infrastructure. Growing technology has helped the
investors to think of better ideas and alternatives. Electrical vehicles can be such an idea. The
invention and proper distribution of EV’s can be a boon. Companies often rely deeply on data at
their initial stages for cost effectiveness. Investors should be able to understand the motto and
should be able invest a huge amount into it so that they can reap great returns. So as to attain all
of it Brand marketing should also take place. They should bring in new projects which would
push boundaries and unlock a new venture of it. Maintaining a brand standard include
maintaining an appearance of the CEO and also keeping a vibrant motto. Elon Musk s purchase
of twitter an others has increased the exposure of his towards the masses.

Eon Musk should currently secure the future of the company by concentrating on the company
now rather than searching for something new. They need to fix issues related to the present brand
and products rather than searching for others. The investors would not back out from investments
with minimum errors they are not likely to advent into new ventures.

1. Assess Musk’s strategy for SpaceX? What is the strength and weakness of Starlink?
Starship?

Elon musk is a leader of his own. Some may differ from two opinions one of him being an
over promisor and other of him being a reckless guy. Being such a personality has obviously
gained him a stardom of his own. If we look into his journey he has been an over promisor
for sure. One such over promised product of his is Starlink. During the past years Elon Musk
saw a void in the industry of rocket components which motivated him to venture the industry.
But certainly, during that time the company was not efficient to program such a mission. This
intimidated him to build the rockets at his house. But as we see it did not go well for him as
he failed 3 times which almost made him bankrupt. Later on, in the 4 th attempt SpaceX was
a huge success. Company never let the failure stop them. As we can see SpaceX is a huge
success reaping almost 60-150 million per launch. On the other hand others charged almost
400 million. Elon Musk also put forth the idea of Starlink. Which is by having thousands of
satellites in the low orbit musk to create a internet satellite service.

STRENGTH: STARLINK

 Starlink has achieved a competitive advantage over others

 This unique internet service can even provide internet service to rural areas.

WEAKNESS: STARLINK

 Starlink needs a huge initial and future investment

 Satellites needs to be launched in intervals regularly to complete a constellation
 Which impacts a huge crowding of these satellites in low orbit region
  After research most estimates related are wrong
 Its turn to profitability is hard to reach
Initial idea of Musk which is Falcon9 carries more or less of 60 satellites. Whereas
Starship can launch about 400 satellites. Which makes it largest and powerful.

STRENGTH: STARSHIP

 Cost of transportation of starship is low

 It can launch up to 400 satellites.
 Largest and most powerful launch system of all times.
WEAKNESS: STARSHIP
 Process of progression is slow
 Chances of been at loss.
Musk intends to establish a Martian colony as part of his aim to expand human
civilization to other planets. As a futurist strategist, he is always thinking ahead and
developing plans accordingly. Musk's first idea was to launch a colonization mission to
Mars. But these days, his plans involve a whole satellite constellation and more. It's
crucial that he remember the original vision.
2. Assess Musk’s strategy for Tesla? What are the strengths and weaknesses of Tesla? Is
being the most vertically integrated car company a strength or weakness?
The transition to a solar-powered and battery-free economy is one of Tesla's primary
goals. 2006 saw the beginning of production of the Tesla Roadster. The majority of the
production of the Roadster was contracted out, whereas the Model-S was manufactured
in-house. In order to reduce the price of batteries, a Gigafactory complex was constructed
in Nevada. Elon Musk puts a significant amount of money into achieving his ambitions
for Tesla. And as a result of that, he was forced to solicit financial backing from the stock
market. Elon announced a plan of purchasing SolarCity. He argued that realizing Tesla's
vision of sustainable energy was crucial. Despite this, SolarCity's market share has
decreased since the acquisition. Tesla had manufacturing issues and missed output targets
because of its heavy reliance on automation. Elon accepted responsibility. Tesla sales
soared during Covid as other firms struggled with semiconductor chip shortages. Tesla
proposed batteries. Tesla's software gives them an advantage.
 STRENGTH: TESLA
 According to the market value tesla is the most valuable automaker
 High quality electric cars
 Company is innovative
 Effective unconventional strategies

WEAKNESS: TESLA

 Employee turnover is high

 Manufacturing complications
 Inefficiency to meet demand
 High financial issues and uncertainty.

Before Tesla, there wasn't much of a market for electric vehicles. The corporation
achieved success at the time due in part to its vertical integration. However, the
industry has since expanded, attracting a slew of new competitors. Just like Intel,
Tesla is facing a decision. If Tesla wants to survive in today's market, it needs to
break apart and start outsourcing some of its production. Thus, they will be able to
keep up with the rising demand. As the market expands, the firm risks missing out on
growth if it continues to insist on maintaining complete control over all aspects of
production. Inevitably, this is a stage that all businesses must pass through. To put it
simply, Tesla will benefit in the long run.

3.Would you advise Musk to continue to shoot for the moon (or more accurately Mars)?
Stay the course, but take on nothing new? Or retrench, and narrow his focus? WHY?

The piece of advice I'll give Elon Musk is to focus on a select few businesses. He needs
to focus on Tesla and SpaceX. He has to abandon Starlink and return SpaceX's attention to its
founding mission: colonizing Mars. We need to prioritize Tesla's plan to build a solar-powered
economy. He needs to shut down and liquidate his other businesses. SpaceX, Tesla, Twitter,
Hyperloop, OpenAI, The Boring Company, and Nuralink are all companies that Elon Musk
oversees. There is no relationship between any of these businesses. One person cannot possibly
be responsible for the smooth operation of so many businesses. As a result, many establishments
are losing money.