Histograms and Scatter Plots for TSLA

Using Analytic Techniques to Add Meaning to Data

Tesla Overview

Tesla has been at the forefront in efforts to transform the automotive industry via the development of mainstream electric vehicles. Tesla’s vision is “to accelerate the world’s transition to sustainable energy” (Tesla, 2022). However, competition is rising, as other companies like BMW, VW, Ford, GM, and newcomers like Rivian, have leapt into the space as well. The industry is currently distressed by supply chain woes, but Tesla is well-positioned to build on its brand and maintain its lead in the EV space so long as it continues to deliver on product promises.

In terms of sales, Tesla remains the market leader in EVs in the United States. For instance, more than half of all electric vehicles registered in the country in the first half of last year were Teslas (Levin, 2021). Available data, however, indicates that we are losing our market share to a number of competitors. There is need to assess why this has been the case and the strategic adaptations that ought to be made to reverse the trend.

From the onset, it would be prudent to note that according to Brigham (2021), one of the key reasons as to why Tesla is being beaten by some of its competitors in Europe has got to do their embrace of cheaper price points. For instance, VW has the very affordable hatchback christened the ID.3. In the past, Tesla has largely been in favor of a differentiation strategy. This way, it has largely been able to gain a competitive advantage in the past. I am of the opinion that it is time to consider a cost leadership strategy.

In the words of Amason (2011), a cost leadership strategy could be conceptualized as “a business-level strategy employed by companies who wish to gain a competitive advantage by being the lowest-cost producer of a service, production process, or commodity” (p. 198). Thus, if tesla were to significantly slash its costs, it would be able to offer the market well-built and innovative products at cheaper price points. This is especially important given that going forward, we are likely to encounter more instances of downturns in economic activity as a consequence of the interconnected nature of global trade. For instance, the recent COVID-19 pandemic has impacted global economies negatively and resulted in the closure of businesses and loss of employment. Such events impact the disposable income of consumers and loss of purchasing power. In embracing a low cost strategy, Tesla will be able to wither such events more effectively.

Graphical Representations of Data

Figure 1.

Figure 2.

Figure 3.

Figure 4.

Descriptive Statistics

FIGURE 3: Historical Adj. Close

Mean: 807.0314939

Median: 744.305

Mode: 714.63

Standard Deviation: 172.3882

FIGURE 4: Volume

Mean: 25817505

Median: 24226900

Mode: N/A

Standard Deviation: 9358742

Summary of What the Data Suggests

TSLA stock is quite volatile over the past year, as the standard deviation of volume and historical adjusted close show. The stock has traded in a range from as low as approximately 600 USD per share to approximately double that throughout the time period, most recently trading at approximately 800 USD, which indicates the stock has nearly round-tripped over the course of the past year.