BCG Matrix

The BCG Matrix for Tesla Motors will help Tesla Motors in implementing the business level strategies
for its business units. The analysis will first identify where the strategic business units of Tesla
Motors fall within the BCG Matrix for Tesla Motors.

Stars
The financial services strategic business unit is a star in the BCG matrix of Tesla Motors. It operates
in a market that shows potential in the future. Tesla Motors earns a significant amount of its income
from this SBU. Tesla Motors should vertically integrate by acquiring other firms in the supply chain.
This will help it in earning more profits as this Strategic business unit has potential.

The Number 1 brand Strategic business unit is a star in the BCG matrix of Tesla Motors, and this is
also the product that generates the greatest sales amongst its product portfolio. The potential
within this market is also high as consumers are demanding this and similar types of products. Tesla
Motors should undergo a product development strategy for this SBU, where it develops innovative
features on this product through research and development. This will help Tesla Motors by
attracting more customers and increases its sales.

The Number 2 brand Strategic business unit is a star in the BCG matrix of Tesla Motors as Tesla
Motors has a 20% market share in this category. It also the market leader in this category. The
overall category is expected to grow at 5% in the next 5 years, which shows that the market growth
rate is expected to remain high. Tesla Motors should use its current products to penetrate the
market. This could be done by improving its distributions that will help in reaching out to untapped
areas. This will help increase the sales of Tesla Motors.

Cash Cows
The supplier management service strategic business unit is a cash cow in the BCG matrix of Tesla
Motors. This has been in operation for over decades and has earned Tesla Motors a significant
amount in revenue. The market share for Tesla Motors is high, but the overall market is declining as
companies manage their supplier themselves rather than outsourcing it. The recommended strategy
for Tesla Motors is to stop further investment in this business and keep operating this strategic
business unit as long as its profitable.

The Number 3 brand strategic business unit is a cash cow in the BCG matrix of Tesla Motors. This is
an innovative product that has a market share of 25% in its category. Tesla Motors is also the market
leader in this category. The overall category has been declining slowly in the past few years. Tesla
Motors has the power to influence the market as well in this category. It should, therefore, invest in
research and development so that the brand could be innovated. This will help the category grow
and will turn this cash cow into a star. The overall benefit would be an increase in sales of Tesla
Motors.

The international food strategic business unit is a cash cow in the BCG matrix for Tesla Motors. This
business unit has a high market share of 30% within its category, but people are now inclined less
towards international food. This change in trends has led to a decline in the growth rate of the
market. The recommended strategy for Tesla Motors is to invest enough to keep this strategic
business unit under operations. If it no longer remains profitable and turns into a dog, then Tesla
Motors should divest this strategic business unit.

Question Marks
The local foods strategic business unit is a question mark in the BCG matrix for Tesla Motors. The
recent trends within the market show that consumers are focusing more towards local foods.
Therefore, this market is showing a high market growth rate. However, Tesla Motors has a low
market share in this segment. The recommended strategy for Tesla Motors is to invest in research
and development to come up with innovative features. This product development strategy will
ensure that this strategic business unit turns into a cash cow and brings profits for the company in
the future.

The Number 4 brand strategic business unit is a question mark in the BCG matrix for Tesla Motors.
This strategic business unit is a part of a market that is rapidly growing. However, this strategic
business unit has been incurring losses in the past few years. It has also failed in the attempts made
at innovation by research and development teams. The recommended strategy for Tesla Motors is
to divest and prevent any future losses from occurring.

The confectionery strategic business unit is a question mark in the BCG matrix for Tesla Motors. The
confectionery market is an attractive market that is growing over the years. However, Tesla Motors
has a low market share in this attractive market. The low sales are as a result of low reach and poor
distribution of Tesla Motors in this segment. The recommended strategy for Tesla Motors is to
undergo market penetration, where it pushes to make its product present on more outlets. This will
ensure increased sales for Tesla Motors and convert this strategic business unit into a cash cow.

Dogs
The plastic bags strategic business unit is a dog in the BCG matrix of Tesla Motors. This strategic
business unit has been in the loss for the last 5 years. It also operates in a market that is declining
due to greater environmental concerns. The recommended strategy for Tesla Motors is to divest this
strategic business unit and minimise its losses.

The Number 5 brand strategic business unit is a dog in the BCG matrix for Tesla Motors. This is
operating in a market segment that is declining in the past 5 years. The company also has negative
profits for this strategic business unit. However, it is expected that the market will grow in the future
with environmental changes that are occurring. The recommended strategy for Tesla Motors is to
invest in the business enough to convert into a cash cow. This will ensure profits for Tesla Motors if
the market starts growing again in the future.

The synthetic fibre products strategic business unit is a dog in the BCG matrix of Tesla Motors. The
market for such products has been declining, and as a result of this decline, Tesla Motors has been
facing a loss in the past 3 years. The market share for it is also less than 5%. The recommended
strategy for Tesla Motors is to divest this strategic business unit to minimise any further losses.

The artificially flavoured products strategic business unit is a dog in the BCG matrix for Tesla Motors.
These products were launched recently, with the prediction that this segment would grow.
However, with increasing health consciousness, people are now refraining from consumption of
artificial flavours. The market is shrinking, and Tesla Motors has no significant market share. The
recommended strategy for Tesla Motors is to call back this product.
Some of the strategic business units identified in the BCG matrix for Tesla Motors have the potential
of changing from their current classification. For example, a dog changing to a cash cow. These have
been identified in the BCG matrix of Tesla Motors and recommended strategies to ensure such
change have also been made.

Ansoff Matrix

Corporate Strategy

To Build More EV’s