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Meet customer requirements through new and unique solutions.

Increases an organizations competitive advantage Can be used as a tool to develop an innovative culture

For an automotive industry:

Improve  vehicle quality, reliability, safety and utility.

Due to increased environmental concerns such as tailpipe emissions, carbon dioxide production, recycling and increased prices of petroleum  sale of cars will decrease if the industry does not come up with useful innovations

Result in more efficient vehicle development processes to shorten development cycles.

Helps achieve long term growth.

Much higher in terms of competitive position as well as decrease in costs.

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Tesla

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Adler, B. (2014, Oct 3). Wall Street Survivor. Retrieved MArch 14, 2017, from http://blog.wallstreetsurvivor.com/2014/10/03/tesla/

Boylan, C. (2016, May 27). Clean Technica. Retrieved March 14, 2017, from https://cleantechnica.com/2016/05/27/brief-history-tesla-cars-one-simple-infographic/

Bradley, R. (2016, MArch 29). Sustainable Energy. Retrieved March 14, 2017, from https://www.technologyreview.com/s/601063/teslas-cheaper-model-3-could-strain-charging-infrastructure/

Donald, M. M. (2016, August 12). Oil price. Retrieved MArch 15, 2017, from http://oilprice.com/Energy/Energy-General/The-Key-Challenge-To-Teslas-Growth.html

Field, K. (2016, April 10). Clean Technica. Retrieved MArch 15, 2017, from https://cleantechnica.com/2016/04/10/tesla-supercharging-crisis-horizon/

Imaginenatincomau. (2016, March 7). Imaginenation. Retrieved March 14, 2017, from http://www.imaginenation.com.au/innovation-blog/8-reasons-innovation-important-businesses-today/

innovationXchange. (n.d.). Retrieved March 14, 2017, from ixc UK Limited : http://www.ixc-uk.com/Importance_of_Innovation_in_Business.html

Stewart, J. (2016, Oct 24). Retrieved March 14, 2017, from https://www.wired.com/2016/10/teslas-self-driving-car-plan-seems-insane-just-might-work/

Tesla. (n.d.). Retrieved March 14, 2017, from https://www.tesla.com/presskit/autopilot

Tesla press information. (n.d.). Retrieved March 14, 2017, from Tesla: https://www.tesla.com/presskit/autopilot

Wyman, O. (n.d.). 2015 car innovation. Retrieved March 14, 2017, from emic: http://www.emic-bg.org/files/CarInnovation2015_engl.pdf

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According to the NPD process Tesla and considering the challenges it is facing it should focus on the development stage. The problems that Tesla’s Model 3 is facing must be resolved before the final product is launched in the market. Before launching and start producing mass quantities of cars it is vital for Tesla to resolve the current issues it is facing. The issue of the super charging networks can be resolved if Tesla focuses on the strategy it has implemented on the way the super charging stations operate. It can implement the Radius model to prevent this issue. The model indicates that if charging at the station is not free it will encourage users to use home charging as an alternative method. This will lighten the load on the public charging stations. The model explains that the issues should be resolved while preparing the marketing strategies in the development stage. It strategy should include the following:

·        At local charging, within 50 miles of home, the re-charging at the station must be billed to encourage home charging.

·        At mid-range charging, 50-100 miles from home, the driver can round-trip a destination on a single charge. Therefore, public charging will not be required.

·        At long-range charging over 100 miles, charging can remain free.

This strategy, implemented in the development stage can help Tesla overcome this issue.

(Field, 2016)

The second problem will also focus on the development stage but its focus will be on the technical side. The issue is related to the future technical requirements of the cars produced and therefore at this stage it is essential for Tesla to make supply contracts with junior mining companies in order to obtain lithium at low prices. It has become extremely vital for Tesla to work on its supply chain and the best method it can use at this stage is a backward integration with a supplier in order to prevent future shortages of lithium and that the future production processes do not get affected. Tesla must resolve this issue before launching its Model 3 as it will later become difficult for it to produce 500,000 Model 3 cars without an effective supply chain to produce its batteries. (Donald, 2016)

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"Love this service! Love my new car! Truly a worry free experience."

-Sue B. saved $5,126 off MSRP
(http://www.consumerreports.org/cro/tesla-model-3.htm)

"The four-door will scuttle silently from 0-62mph in 'less than 6.0sec', so performance should be, ahem, electric. We should be testing the 3 in 2017, ahead of its planned launch in 2018 - so stay tuned for our full Tesla Model 3 review."
-Elon Musk (CEO)
(http://www.carmagazine.co.uk/tesla/model-3/)

"The lack of a dashboard/HUD is something that I don't think I could get used to. That's the only thing I don't like about the car."
-Brandon Volvo
(http://www.theweek.co.uk/tesla-model-3/70320/tesla-model-3-release-date-price-and-specs)

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Tesla being an automotive company launched its first electric sedan in 2012 which was named the model S. It refined the concept of a four door car and was claimed to be 100 percent electric. The company was founded in 2003 and focused on the notion that electric cars are better than gasoline cars with zero emissions to accelerate the world’s transition to sustainable energy.   The model S had a range of 270 miles which was even greater than its previous model the Roadster which was a sports car. Tesla also offered a high-speed charging network which would recharge the car from empty to fully charge in an hour. Later in 2015 Tesla introduced the model X which is a fully electric crossover/ SUV. It has seating for seven adults, along with a  higher driving position of an SUV, a huge panoramic windshield that extends behind the front seat passengers’ heads for maximum visibility, and towing capability up to 5,000 pounds (a first in an electric SUV). IT also consists of unique falcon-wing doors. Tesla added additional value by installing an air filtration system with dual-activated carbon filters and HEPA to prevent smog and keep cabin air fresh. It includes a “Bioweapon Defense Mode” that works in areas of the world that suffer from excessive air pollution.  (Boylan, 2016) Model 3 is the next launch of Tesla and the production is scheduled to begin in mid 2017 which is designed with safety as a priority and is combined with over 200 miles of range however it is priced at $35000 which is a lot cheaper and without compromising on the quality, which is also a step towards innovation. (Tesla) Additionally, Tesla has introduced the most innovative feature with consists of a self-driven function in its cars known as the autopilot.  This feature is their latest software update which consists of auto-steer, auto lane change, auto park and side collision.

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Tesla’s autopilot system is not perfect and it requires human attention at all times. Also, Tesla cars are a lot more expensive than any other Sedan car. For customers to enjoy the auto-pilot feature have to spend a huge amount.

The model 3 which Tesla claims to be cheaper than the other models costs 35 thousand dollars.

Tesla customers also complain about the lack of charging stations. Also, Tesla states on its website that the self-driving functionality is dependent upon extensive software validation and regulatory approval, whereas the US state regulators are not ready to validate this system which is a setback. (Stewart, 2016)

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The Tesla cars are highly known for safety and are proven by its NHTSA and Euro NCAP 5-star safety rating and also set the record for the lowest injuries to occupants when tested in US as it contains a unique electric drive-train that is placed beneath the car.

It also has a low center of gravity which minimizes the risk of rollover. It is also highly efficient as it allows you to travel anywhere without using gasoline at all.

The additional benefit of over the air software update adds functionality, boosts performance and improves driving experience. The new auto-pilot hardware will assist with Autosteer and Traffic-Aware Cruise Control which assists the driver on the road by steering within a lane. Also the Auto Lane Change feature helps the drivers to safely change lanes.

The Autopark feature helps the vehicle detect a parking spot and with the summon you can move Model S in and out of a parking space from outside the vehicle using the mobile app or the key.

These entire features make a drivers experience much safer as it assists with decision making and reduces the chances of accidents. (Tesla press information).

Tesla also claims that its cars have covered 222 million miles in autopilot mode which is more than its competitor, Google which has whose cars have covered 2 million miles, therefore Tesla autopilot system has more data.

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The super charging network:
The problem arises when the vehicle has to be charged especially when the owner has to take a long trip. To overcome this problem Tesla has developed its super charger network where the owners can charge their Tesla’s for free. With the introduction of Tesla’s model 3, it is obvious that more customers will demand the product due to its cheaper price as compared to the previous models. The price of Model 3 will be 35000 dollars and it is expected that the company will sell 500,000 vehicles in 2020, almost 10 times the number they sold in 2015. Currently Tesla is designing cars that are targeting mass market and its current super charging stations can only be sufficient for the cars previously launched targeting niche market. Tesla has already received a huge amount of pre-orders and once the car is launched these super charging station will not be enough for all those cars Tesla will be selling. As electric cars are much more preferred by the customers due to its cheap usage and the environmental benefits it provides it is expected to make a huge amount of sales. Therefore, this is a challenge for Tesla, public charging stations. Currently the vehicle is charged at night in the garage or driveway of a home of the customers, however, charging for people who do not own a garage might be impossible. Currently USA has 3000 charging stations but this will be insufficient once the Model 3 launches. (Bradley, 2016)

Batteries:
Tesla has established a $5 Billion Gigafactory in Nevada which has the largest footprint than any building in the world. It is created for the production of all the electric cars that will be produced by Tesla. It employs 6500 people. Tesla aims to produce over 500,000 cars by the end of 2018. The size of the Gigafactory makes this possible. Also, Tesla has already received 375,000 preorders for its Model 3. However, in order to meet this Tesla needs to produce more lithium ion batteries which is a challenge. Tesla does not have a demand problem but it is facing supply shortage issues that need to be resolved. The company has not yet announced any lithium supply deals to overcome this problem. If the company produces its own batteries, which is quite cost effective, it can overcome this problem. However, due to increased demand for electric batteries the global lithium market is also approaching shortage.

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Carbon Fiber Wheels:
These will help reduce the overall weight, which is important in making cars move quicker.

15-inch infotainment screen:
This will display the speed and other essential driving information.

Grill-less front end:
This is an innovation that no other car manufacturers have made.

Unique Camper mode:
The car has a unique feature that allows its owners to use it as a tent while on camping. The rear seats of the car fold and 66 inches of space is available for sleeping.

Upgraded battery technology:
The battery pack used in the new Tesla is denser and updated with a cooling system which helps the car drive further without recharge.

(Source: https://teslamodel3price.com/ )