The International/Global Operations and Their Key Markets and Potential Competitors Part I: Key Market

Tesla (TSLA) is a leader in the electric vehicle and solar and powerwall services. However, because of the company’s broad entry into a number of different market segments (from cars to trucks to batteries to solar power), Tesla has a number of competitors around the world, including: Tata, GM, Honda Motor Company, Kandi Technologies, Navistar, Oshkosh, PACCAR, Toyota and many others. Tesla maintains a network of 80 stores across North America, Europe and Asia and has reported gross revenues of more than $2 billion in recent years. Its market cap is currently over $50 billion. In order to compete on the global scale, Tesla must continue to internationalize operations.

Potential regions and countries that Tesla should target include developed markets (DMs) and emerging markets (EMs): Europe and Asia are already targets of Tesla, but countries such as Nigeria, South Africa, India and regions in South America could benefit from Tesla’s solar power and powerwall products as well as from its electric cars and electric car grids. With India and Africa becoming huge players on the global stage and more and more corporate eyes turning to these regions, Tesla should make a play to capture market share early. In India, its main competitor would be Tata, but in Africa nothing is really settled and countries like Nigeria and South Africa are looking for corporations to help transform their nations into first world powerhouses. Indeed, Tesla’s powerwall and solar panels have not gone unnoticed in these regions, as even the Hindustan Times (2017) has reported on Elon Musk’s installation of solar roofs—so the interest is there.

As Koppelaar and Middlekoop (2017) report, Tesla is leading the electric power revolution that is seeing many nations convert their old infrastructure from fossil-fuel-based to green energy-based. Agar and Renner (2016) have examined whether 100% renewable energy is possible in urban areas and found that where collaboration between government leaders and industry leaders exist, it is very much possible.

In India, the size of the market is substantial: Bavirisetty (2017) notes that “India is expected to become the world’s third biggest solar market...

The cumulative solar capacity, including rooftop and off-grid segments, has crossed 10,000 MW. With an average capacity addition of 8-10 GW per annum, the total installed capacity is expected to reach around 18 GW by end of 2017.”  In South Africa there is just as much push for solar energy: “South Africa?s Renewable Energy Independent Power Producers Procurement Programme (the REI4P) is an extensive initiative to install 17.8 GW of electricity generation capacity from renewables – wind, solar, biomass, biogas and hydropower – over the period 2012–2030” (Walwyn & Brent, 2015).
In India, solar power accounts for nearly 40% of all new power capacity, and much of that is thanks to the Modi government, which is pushing for renewable energy (Sushma, 2017). IBEF (2018) reports that “around 293 global and domestic companies have committed to generate 266 GW of solar, wind, mini-hydel and biomass-based power in India over the next 5–10 years” and that “between April 2000 and March 2017, the industry attracted US$ 11.59 billion in Foreign Direct Investment (FDI). Tata is a major player in the region and has “invested Rs 200 crore (US$ 31.05 million) in their joint venture (JV), Tata Cleantech Capital Ltd (TCCL), to increase its loan book for investing in renewable energy projects” (IBEF, 2018). Tata has an EV model available for purchase.

In South Africa, Soitec (a French firm), Sun Tank (South Africa’s leading solar heating firm), and Solar Capital are leading the way. Solar Capital has developed a solar farm in South Africa: “a 175-megawatt facility that spreads over almost 500 hectares” (CNN, 2016). In terms of EVs, only BMW and Nissan have EV models available, but Volkswagen SA is in the marketplace and in development of an EV model that may enter into the SA market.

The balance of trade in India stood at a deficit of 95.37 billion USD in 2016. In South Africa, the balance of trade stood at a deficit just shy of a quarter of a billion USD. The exchange rate for India currently is currently USDINR: 63.5875, which is near its all-time high peak of 69.1, which was touched in 2013. The exchange rate for South Africa is USDZAR: 11.85, which is down considerably from its 2016…