Tesla: Business & Operating Model Evolution
2022 | Case No. OIT122 | Length 21 pgs.
Tesla was founded in 2003 on the mission to accelerate the world’s transition to sustainable transport through the production and sale of electric vehicles. The scope of this mission required staged business model development, beginning with low-volume production of a high-priced electric sports car and moving down-market gradually to produce higher volumes of more affordable electric vehicles. Tesla adapted its operating model at each stage and pursued innovations to unlock product performance and increased scale. With expansions into solar power, energy storage, and autonomous fleets, what business model change should Tesla pursue next?
Learning ObjectiveThis case traces the evolution of Tesla’s business and operating model over time. Students will explore how the priorities, capabilities, and challenges of the automaker changed during each stage of business model development. Students will also analyze the key innovations and strategic decisions that enabled Tesla’s success. Finally, students will discuss Tesla’s future opportunities for business and operating model development.
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