Tesla Model 3 Marketing Plan Report

GENTECH 3MB3
Fundamentals of Marketing
Submitted to: Hoda Kamel
Date Submitted: November 25th, 2023

COMPREHENSIVE MARKETING PLAN REPORT ON TESLA

TEAM 1: TEAM XÆ

This Marketing Plan contains our own work for GENTECH 3MB3 and has not been submitted, in
whole or in part, towards fulfilling requirements in any other course, either at McMaster
University or elsewhere.

We have read McMaster’s academic integrity policy and understand that plagiarism, whether
intentional or unintentional, will be dealt with in accordance with university policy and practice.

Joshua Hughes 400298496 November 25th, 2023

Aryan Sagar 400296731 November 25th, 2023
Zhengyao Wang 400228995 November 25th, 2023
Abdulrahman Hajjaj 400265450 November 25th, 2023
 Executive Summary
Tesla, Inc. is a trailblazing company that is leading the way in innovation and market disruption
in the electric vehicle (EV) and sustainable energy sectors. Led by flagship vehicles like the
Tesla Model 3, the company's innovative electric car selection demonstrates its dedication to
revolutionizing the automotive sector. Tesla has dramatically changed consumer expectations
and the course of the car industry by emphasizing cutting-edge technology, autonomous driving
capabilities, and a tireless pursuit of sustainability.

Problems Facing Tesla

Tesla faces several challenges that warrant strategic consideration. These include heightened
competition in the electric vehicle market, supply chain complexities affecting production
scalability, and regulatory uncertainties in various markets. Additionally, concerns related to
product quality control and potential safety issues have surfaced. While the company's
ambitious goals and rapid innovation have fueled its success, addressing these challenges is
imperative to ensure sustained growth, maintain consumer trust, and navigate an ever-evolving
industry landscape. Tesla's ability to proactively manage these issues will play a crucial role in
shaping its future trajectory.

Recommendations for Tesla

Recommendations for enhancing Tesla's marketing plan involve a multifaceted approach.
Firstly, diversifying marketing channels to reach a broader audience is crucial. While Tesla has a
strong online presence, exploring traditional advertising and strategic partnerships could expand
its reach. Secondly, fostering more direct and consistent communication with consumers would
enhance transparency and address concerns, particularly related to product quality and safety.
Leveraging customer testimonials and success stories could further bolster the brand's
credibility. Additionally, refining regional marketing strategies to address specific cultural
nuances and preferences could optimize market penetration. Lastly, continued investment in
research and development to stay ahead of technological trends and maintain a competitive
edge is vital for sustaining Tesla's leadership in the electric vehicle market.

Conclusion
In conclusion, Tesla, Inc. represents a paradigm shift in our transportation and energy
paradigms, leading the electric vehicle revolution. Symbolic of Tesla's mission, the Model 3
represents the company's commitment to sustainability, innovation, and a future in which electric
cars will be essential in creating a more technologically advanced and environmentally friendly
world.

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Table of Contents
Executive Summary.....................................................................................................................1
Problems Facing Tesla............................................................................................................ 1
Recommendations for Tesla.................................................................................................... 1
Conclusion............................................................................................................................... 1
Table of Contents.........................................................................................................................2
1.0 Company/Organization Overview........................................................................................ 4
1.1 Profile/History.................................................................................................................... 4
1.2 Strategic Business Units (SBUs)....................................................................................... 4
1.3 Mission and Vision............................................................................................................. 4
1.4 SWOT Analysis..................................................................................................................5
1.5 Goals and Objectives.........................................................................................................5
1.6 Canadian Presence........................................................................................................... 6
2.0 Macro-Environmental Analysis............................................................................................ 6
2.1 Political.............................................................................................................................. 6
2.2 Economic........................................................................................................................... 7
2.3 Social................................................................................................................................. 7
2.4 Technological..................................................................................................................... 7
2.5 Environmental....................................................................................................................8
2.6 Legal.................................................................................................................................. 8
3.0 Competitor Analysis..............................................................................................................9
3.1 Analysis of General Motors................................................................................................9
3.1.1 GM Positioning Strategy........................................................................................... 9
3.1.2 GM Marketing Mix Analysis.................................................................................... 10
3.1.3 GM SWOT Analysis................................................................................................ 11
3.2 Analysis of Hyundai......................................................................................................... 12
3.2.1 Hyundai Positioning Strategy..................................................................................12
3.2.2 Marketing Mix Analysis........................................................................................... 12
3.2.3 Hyundai SWOT Analysis.........................................................................................14
3.3 Market Share Breakdown and Comparison of Competition Products............................. 15
4.0 Target Market Analysis........................................................................................................15
4.1 Sustainable Visionaries................................................................................................... 15
4.1.1 Geographic............................................................................................................. 15
4.1.2 Demographic...........................................................................................................16
4.1.3 Psychographic........................................................................................................ 16
4.1.4 Behavioural............................................................................................................. 16
5.0 Marketing Mix Product or Service Strategy...................................................................... 17
5.1 Product/Service Strategy................................................................................................. 17
5.2 Positioning Strategy.........................................................................................................17
5.3 Pricing Strategy............................................................................................................... 18

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 5.4 Promotion and Advertising Strategy................................................................................ 18
6.0 Conclusion........................................................................................................................... 19
6.1 Marketing Plan Successes.............................................................................................. 19
6.2 Marketing Plan Failures................................................................................................... 19
7.0 References........................................................................................................................... 20
7.1 Company/Organization Overview.................................................................................... 20
7.2 Macro-Environmental Analysis........................................................................................ 21
7.3 Competitor Analysis.........................................................................................................23
7.4 Target Market Analysis.................................................................................................... 24
7.5 Marketing Mix Product of Service Strategy......................................................................25
APPENDIX A...............................................................................................................................25
Tesla Emissions Report......................................................................................................... 25
Vehicle Comparison - Tesla Model 3 vs Cadillac CT4 2023.................................................. 26
Tesla Charging Stations Map.................................................................................................26

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1.0 Company/Organization Overview
1.1 Profile/History
Tesla was founded in 2003 by Martin Eberhard and Marc Tarpenning who aimed to create
electric vehicles that were both high-performing and environmentally friendly. Tesla gained
attention for its innovative approach to electric cars, particularly with the release of its Roadster
model in 2008. The company focused on advancing battery technology and creating long-range
electric vehicles.

Elon Musk, co-founder of PayPal, provided initial investment for Tesla and eventually took over
as CEO in 2008, leading the company to substantial growth and innovation. Musk might have
shared his reservations about taking the leadership role however the circumstances led to him
assuming the position. It might also cover his vision for Tesla's future and the challenges he
anticipated or encountered while leading the company.

Tesla started to gain prominence in 2012 upon releasing its flagship car, the Model S, which
positioned the company as a successful independent automaker and a pioneer in the electric
car market. By September 2014, the Model S achieved record sales in the U.S., selling 2,500
units in a single month, and reaching 10,030 units sold in Q1 2015. As of March 2022, Tesla's
market capitalization stood at $909.6 billion, signifying its significant market value and growth.

1.2 Strategic Business Units (SBUs)

Business Strategy Analysis:
● Research and Development: Significant investment focusing on automation, material
costs, and software updates.
● Production: Focus on manufacturing in Fremont, California, with key components built
in-house, including lithium-ion batteries.
● Supply Chain Strategy: Secured relationships with suppliers, minimizing leverage and
ensuring necessary resources.
● Human Resources: Intense work culture, hiring for innovation, continuous expansion
worldwide.
● Total Quality Management: Balancing productivity and quality, increased automation and
in-house manufacturing.
● Marketing: Relies on earned media, viral marketing, social media (especially Elon
Musk's engagement), and limited advertising.
● Pricing Strategy: Mix of premium pricing and market-oriented pricing for different car
models and products.
● Distribution Channels: Direct-to-consumer strategy, minimal intermediaries, focus on
online sales and company-owned stores.

1.3 Mission and Vision

Tesla's mission and vision statements encapsulate the company's essence and strategic
direction within the electric automobile and energy sectors. These statements align with Tesla's

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market opportunities and guide its growth. The mission statement focuses on accelerating the
global transition to sustainable energy, signalling a shift from the previous focus solely on
sustainable transport under Elon Musk's leadership. It highlights acceleration, global transition,
and sustainable energy as its key components, indicating Tesla's goal to stimulate demand for
sustainable energy solutions globally and its diverse product range, including electric vehicles,
batteries, and solar panels.

Tesla's vision statement aims to establish itself as the most compelling car company of the 21st
century by leading the world's transition to electric vehicles. It emphasizes leadership,
excellence in the automotive industry, relevance in the modern era, and spearheading the global
shift to electric vehicles. However, the vision statement primarily focuses on transportation, not
fully reflecting Tesla's expanding interests in energy solutions beyond electric cars.

1.4 SWOT Analysis

Strengths:
- Market Value Leadership
- Leading Electric Cars
- Surge in Deliveries
- Diversification Strategies
- Consistent Innovation
- Resilience in Economic Uncertainty
- Unique Management Strategy
Weaknesses:
- Manufacturing Complications
- Supply-Demand Imbalance
- Volume Production Challenges
- Battery Shortage
- Dependence on Elon Musk
- Financial Uncertainty
- Safety Concerns
- Internal Leadership Conflicts

Opportunities: Threats:
- Market Expansion - Liability Claims
- Affordable Model Launch - Intense Competition
- In-House Battery Production - Product Defects
- Entry into the Truck Segment - Long-term Credibility
- Growing Market Confidence - Customer Adaptation
- Air-Taxi Market Entry - Safety Concerns with Self-Driving
- Large Fleet Orders - Supply Disruptions
- Lithium-ion Risks
- Regulatory Uncertainty
- Impact of Elon Musk's Behavior
- Economic Downturn

1.5 Goals and Objectives

Tesla's primary objectives are to revolutionize the automotive and energy sectors via innovation,
sustainability, and global reach. Their main goal is to develop cutting-edge electric vehicles and
renewable energy sources in order to hasten the shift to sustainable energy. To increase the
market for high-performance electric vehicles, Tesla is always striving to improve the technology
of electric vehicles. They branch into new markets and customize their products to suit local

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needs as part of their worldwide strategy. In terms of strategy, Tesla wants to promote new
products, keep up financial growth and stability, boost manufacturing, and expand the
distribution of electric automobiles. In line with its objective, the business is dedicated to moving
beyond autos and into a variety of sustainable energy solutions.

1.6 Canadian Presence

With over 1,200 employees and continuous recruitment for new positions, Tesla's footprint in
Canada is growing significantly. There are currently 31 stores in Canada:

● British Columbia: 6 stores

● Nova Scotia: 1 store
● Ontario: 15 stores
● Quebec: 6 stores
● Saskatchewan: 1 store
● Alberta: 2 stores

As of October 5, 2023, Canada hosts a total of 197 Tesla Supercharger locations. Ontario leads
the provinces with the highest number of Tesla Supercharger sites, accounting for
approximately 36% of all Supercharger locations in Canada, boasting 70 sites.

The next step for Tesla in Canada might involve establishing an actual vehicle manufacturing
facility.This expansion could potentially leverage Canada's strong incentives for electric vehicle
sales and the country's growing importance in the electric vehicle market.

2.0 Macro-Environmental Analysis

The Tesla Model 3 currently resides in the growth phase of its product life cycle. Electric
vehicles (EVs), including the Model 3, are a relatively recent addition to both the Canadian and
global automotive markets, having made their debut in 2017. The Model 3 has, thus far, gained
six years of market presence. While initial skepticism surrounded the adoption of electric
vehicles, there is a noticeable shift in consumer sentiment, leading to heightened interest in the
EVs Tesla is offering. As the Model 3 gains traction with consumers, providing valuable
feedback, the market is poised for sustained expansion. This trajectory not only paves the way
for the introduction of new Tesla models but also augurs the integration of more advanced
features into the company's product portfolio.

2.1 Political
Government Incentives: The government is providing monetary incentives to people who
purchase electric vehicles, of which Tesla has the largest market share. (Light-Duty
Zero-Emission Vehicles, 2022)

Political Opposition from Gas Companies: Major gas companies who profit off the sale and
use of gas-consuming vehicles don’t want electric vehicles to succeed, as it would significantly

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decrease the amount of money they can make. (Is Tesla Really Competing Against The Auto
Industry – Or Oil And Gas?, 2022)

Emissions Regulations: Thanks to producing virtually no emissions while driving, electric cars
can easily follow the emission regulations set by the government, however, the major problem
with Tesla’s emissions comes from their manufacturing side. (Impact Report 2022, n.d.)

2.2 Economic
Low Purchasing Power: Tesla is generally viewed as a luxury brand, and as such, the electric
vehicles they sell can’t be purchased by a large percentage of the public. This is both good and
bad for Tesla. Since the people who are able to afford and purchase the Model 3 are generally
upper-middle class, it means Tesla’s clients are generally more willing to spend more money,
even if it cuts out the market of people who would generally only choose to take the minimum
that works. (Armstrong, 2023)

Inflation Rates: Over the past decade, inflation has massively exceeded what is being
portrayed in the media. As prices for necessities rise, with the average household income not
rising to the same degree, people won’t be able to afford the luxuries they used to, especially
not one as expensive as a Tesla. (The Daily — Consumer Price Index, September 2023, 2023)

Low Cost of Maintenance: For the people who already own a Tesla, the cost of fuel barely
affects them, as they can keep their tank full with significantly cheaper electricity. This means
that there will be a higher level of customer satisfaction and the people who don’t need to spend
increasing amounts of money on gas for their cars will be able to save money and improve their
purchasing power. (Woodburn, 2023)

2.3 Social
Elon Musk/Social Media Presence: Tesla has a huge hand in social media, thanks to having
their cars used by large names online and in places like Instagram, X, formerly Twitter, and
YouTube, their brand image can be largely influenced for the better with a great deal of public
recognition. However, with Elon Musk at the helm of it all, there’s no easy way to determine if
this is a good thing, or a massive risk to the company, especially given the Owner’s social media
track record. (Elon Musk, n.d.)

Environmental Awareness: With global threats like global warming becoming more and more
apparent, the general public has finally begun worrying about the future of the planet, becoming
more conscious than ever about their carbon footprint. Tesla’s EVs offer a way to easily reduce
the carbon footprint people produce by significantly reducing the gas emissions from their cars.

Public Perceptions: Despite being well-tested for several years, there are still lingering fears
about the limited range of EVs, especially with a limited supply of charging stations around
Canada. Not to mention the reduced battery life in cold weather, which isn’t a good mix with the
freezing temperatures of Canada’s winters.

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2.4 Technological
Charging Infrastructure: One of the biggest problems Tesla faces when selling their EVs in
Canada is the lack of charging stations. However, as more and more charging stations are
constructed, more and more people will be less worried about driving their cars around Canada.
(Supercharger, n.d.)

New Features like Self-Driving: As the technology and software improve over time, existing
features like Self-driving capabilities will only improve. Especially with advancements in AI, new
features that improve the driving experience of Tesla drivers will only keep emerging. (Burns &
Dikmen, 2023)

Improvements to the Batteries: With advancements in technology occurring every year, the
batteries that Tesla uses will only continue to improve, lasting longer, becoming cheaper to
manufacture, and not deteriorating as quickly in cold weather. (Lu et al., 2023)

2.5 Environmental
Lower Environmental Impact: EVs have a significantly lower environmental impact than gas
cars in terms of emissions created by the customer, since there are much fewer emissions there
is a much less negative impact on the environment. (Tesla 2020 Impact Report, 2020)

Battery Disposal and Recycling: Because of the materials used in the batteries, it is
challenging to dispose of and recycle dead or damaged batteries which can have a tremendous
environmental impact. (Naor, 2022)

Green Energy Trends: People are pushing for cleaner and renewable energy, and Tesla is
actively using methods of generating energy that are cleaner and more renewable than their
competitors. (Kajikawa et al., 2022)

2.6 Legal
Autonomous Driving Regulations: Because Tesla's self-driving feature allows the driver to not
focus as much on the road, several regulations need to be followed. Since it cannot be
guaranteed that the self-driving feature won’t malfunction or turn off when the driver isn’t paying
attention, there could be grave consequences if proper measures aren’t put in place. (O. Reg.
306/15: PILOT PROJECT - AUTOMATED VEHICLES, 2019)

Cybersecurity and Data Collection: Tesla collects massive amounts of data from their
customers, from location data to the speeds they’re driving on the road, to the kind of music
they listen to on the car. Tesla collects vast amounts of information, and customers are
becoming aware of just how much of their private information is being collected, with many not
happy that their privacy is being breached. (Bloom et al., n.d.)

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Open Intellectual Property: Tesla wants to maintain a large market share, but with competition
on the rise, Elon Musk’s decision to make all of their intellectual property open source and
available to their biggest competitors is a dangerous risk that could be the downfall of the
company. (Gitelman et al., 2023)

3.0 Competitor Analysis

As a leading character in the electric vehicle industry, Tesla's product line competes with both
electric and internal combustion engine (ICE) vehicles. This places Tesla in a unique position: it
must not only compete with other EV brands but also need to persuade traditional ICE vehicle
buyers to shift to EVs. This situation results in a more complex competitor landscape.

In 2023, General Motors has the highest market share in the Canadian automotive market and
is the largest competitor of Tesla in Canada, while it is a latecomer of the EV industry. In
contrast, Hyundai represents a different type of competitor. Compared with GM, Hyundai was
involved in the EV industry earlier. Its core EV products may make it a direct competitor of Tesla
in the EV market due to having similar prices and features.

This marketing plan report focuses on GM and Hyundai – representing traditional American and
Asian automakers, which came into the EV industry later and earlier – to provide a
comprehensive analysis of Tesla’s competitive environment.

3.1 Analysis of General Motors

General Motors is a major automotive company in North America with a rich history. GM is
famous for owning numerous companies and selling a wide range of vehicles. Its wide range of
brands and types of vehicles of GM covers a large variety of market segments, which
significantly enhances its market resilience and market share. In Q1 2023, GM dominated the
Canadian automotive market by having the largest market share of 16.7% (GM Leads Canadian
Industry With 16.7% Market Share for Q1 2023, 2023).

3.1.1 GM Positioning Strategy

GM is able to target different target segments with its large brand portfolio. GM emphasizes its
long-standing history as a legacy of the American Industry, relating it with patriotism and as a
symbol of the traditional American automotive industry. By running promotion activities, GM
positions itself as the automaker building “America’s favorite American cars” (Trout, J. 2009) GM
wants people in North America to view its products as part of their lives.

As stated by its website, GM also advertises itself as the leader of the automotive industry and
innovation, “our goal is to have a global vehicle portfolio with advanced platforms and
leading-edge technology including electric and autonomous vehicles” (Growth Strategy to Make
a Difference, GM. 2023). In the automotive market, GM is a direct competitor of Tesla for having
multiple models at similar price intervals and functionality. However, its EV products are priced

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differently from Tesla’s model, which indicates the form of competition is in persuading the
customers to buy its ICE cars instead of EVs of other brands.

3.1.2 GM Marketing Mix Analysis

Product: Having a wide range of brands including Chevrolet, Buick, GMC, and Cadillac, GM
can cover almost all market segments from economic to luxury class, from cars and trucks to
SUVs and crossovers.

Being pushed by the trend of vehicle electrification, GM is beginning its transition towards
electrified vehicles. In 2022, Buick committed to the all-electric portfolio by the end of this
decade, starting with its first electric vehicle to market for North America in 2024(Buick Commits
to All-Electric Portfolio by End of Decade, GM. 2023). GM also developed Ultium, along with IoT
and vehicle-to-home charging technology, it helps optimize home energy costs and possibly
allows the user to sell the saved energy back to the power companies.

Price: Chevrolet offers economic models such as Malibu, which is priced around CA$30,000,
while Cadillac offers CT5, a luxury sedan priced around CA$50,000. Both Chevrolet and
Cadillac manufacture EVs while GMC and Buick’s EVs are still in the conceptual stage.

However, the Cadillac Celestiq EV is offered as a high-end luxury car which is more expensive
than all Tesla models. The Chevrolet Bolt EV is priced at around CA$40,000, which is cheaper
than all Tesla models. Both companies probably positioned their EV products strategically to
avoid direct competition with Tesla, North America’s largest EV manufacturer.

Correspondingly, the current competition between Tesla and GM is about persuading

consumers to purchase either EVs or ICE vehicles. GM offers ICE vehicle models like the
Chevrolet Camaro, GMC Acadia, and Cadillac CT5 that fall in a similar price range to the Tesla
Model 3 (CA$56,000).

Place: GM’s brands allow consumers to select the trim and configuration of a vehicle model on
its websites and contact the dealership to check the inventory or order a specific trim. GM
dealerships cover almost all provinces and territories of Canada, even in the North West and
Yukon Territory, indicating its dominance of the market.

Within the Ultium System GM developing for EVs, there will be charging stations that customers
can install at home and manage through mobile apps. GM is also developing charging and
energy storage stations for both commercial use and public use known as Ultium Commercial
and Ultium Charge 360 (Ultium Products, GM Energy. 2023). These systems can be viewed as
the forward-investing strategy of constructing the infrastructures before generalizing EVs in the
market.

Promotion: GM's heavy investment in promotional activities indicates its utilization of Integrated
Marketing Communications.

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On the advertising aspect, GM’s advertising through television, newspapers, social media, and
online platforms utilizes various modern media to gain attention and persuade customers. This
approach broadens reach and deepens engagement with audiences, reflecting the GM’s
multichannel approach to advertisement. Additionally, to enhance its brand visibility and public
relations, GM has been a major sponsor of events like NASCAR (Chevy Racing & Motorsports,
Chevy. 2023) and Major League Baseball (Business of MLB, Global Data. 2023) for decades,
which are forms of event marketing and sponsorship strategies.

On the product selling level, GM Financial applies targeted and affinity marketing strategies by
offering sales promotions in the form of discounts for specific groups and appreciation programs
for the military, educators, and students (Current GM Offers, GM Financial. 2023). These can be
viewed as GM’s efforts to show it is a socially responsible company. The combination of these
multifaceted promotional strategies not only maintains GM’s market presence but also helps it
appear as a community-focused company.

3.1.3 GM SWOT Analysis

Strengths: The strength of GM is its long history, wide range of brands and types of vehicles,
and good reputation in the North American automotive industry. Especially in the conservative
and right-leaning demographics (Putzer, M. 2022) in Canada and the USA, as people like
farmers and workers have a stronger preference for buying robust, powerful, and sizeable
vehicles.

As a large company, GM has substantial financial resources, technical backgrounds, and

production chains to support its innovations and transition to EVs. These advantages allow GM
to invest more in research and development and have a higher tolerance to risks in the
innovation process, which enables them to afford long-term planning and investing. For
example, the infrastructure construction under the Ultium system started before the widespread
use of GM EVs, which may be a risky move for other companies.

Weaknesses: One major weakness GM is facing is the internal issues within GM’s labour
relations and workforce management, which may be a cause of the UAW strike that took place
in September 2023. Frequent UAW strikes become a constant challenge due to their significant
impact on the company. In 2019, a strike against GM by UAW workers resulted in a 40-day work
stoppage and cost the company US$3.6 billion (Cheung, B. 2023). In 2023, the strike caused a
46-day work stoppage, and the UAW workers demanded a 40% wage increase and 32-hour
work weeks (Shepardson, D. 2023).

The strikes significantly affect the operational stability and financial status of the company,
causing production pauses and product shortages and further leading to a decrease in delivery
rate and company reputation. Moreover, the rise in wages may increase the financial burden,
and eventually lead to the rise of vehicle prices and a decrease in profit and popularity.

Opportunities: GM has a good reputation in the traditional/conservative demographics. It is in a

fortunate position that has the potential to educate some of its targeting customers who despise

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EVs to change their perceptions. GM has the opportunity to be the pioneer who opens a new
EV market different from the current market dominated by Tesla by advertising and emphasizing
the durability, power, robustness, and economic benefits of its EV products, which are qualities
that its loyal customers value.

Threats: As a latecomer to the EV industry, GM may face a saturated market full of competition.
The challenge of GM is to carve out a larger market share from North American EV and HEV
manufacturers that already dominate the market, such as Tesla, Hyundai, and Toyota.

Currently, ICE vehicles remain GM’s major products. However, GM might face the threat of its
main market being disrupted and the urgent need to shift to the EV sector in which it lacks
experience, due to various governments introducing policies to phase out ICE vehicles. Worth
mentioning, both the European Union and the Canadian Government have launched policies to
ban the sale of ICE cars by 2035 (Winton, N. 2023) (Scherer, S. 2021),

Additionally, the current recession and frequent fluctuations in oil prices bring more uncertainty
to the future of the ICE vehicle market. These factors may drive more consumers to shift
towards EVs and accelerate the industry’s transition.

3.2 Analysis of Hyundai

Hyundai was founded in 1967 in South Korea and has grown into a major global automotive
manufacturer. Hyundai offers a diverse range of vehicles and is recognized for its emphasis on
cost-efficiency, design, and innovation. Hyundai entered the Canadian automotive market in
1983. In 2022, it achieved a market share of 7.6% in Canada.

3.2.1 Hyundai Positioning Strategy

Hyundai Canada positions itself as a customer-centric automaker, targeting a diverse market

through demographic, behavioural, and psychographic segmentation. The key product of
Hyundai in the economy class is Elantra, while Hyundai is also developing its luxury SUV
segment under the brand Genesis. In short, Hyundai develops different types of vehicles that
suit different demographics and needs. Additionally, its specific emphasis on the design of the
look of its vehicles makes some customers view it as a symbol of South Korea’s contemporary
art in the automobile industry.

In the EV and HEV market, Hyundai targets the middle-to-upper-income demographic by

introducing models such as the IONIQ and KONA EV. The similar prices and technological
emphasis compared with Tesla’s products show that Hyundai positions itself as a direct
competitor of Tesla in the mid-to-high-end EV market.

3.2.2 Marketing Mix Analysis

Product: Hyundai segments its vehicles into different levels to meet specific consumer
expectations, needs, and lifestyles. For example, the Elantra is available in regular

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(economy-focused), hybrid (innovation-focused), sporty N Line (sport-focused), and
performance-focused N variants, each variant has very different features and pricing, which
allows the consumers to select the most suitable version based on their budget and needs.

Additionally, Hyundai’s wide range of vehicles provides consumers with an abundant selection.
SUV models like the Palisade and Santa Fe emphasize safety and comfort, while the newly
introduced Santa Cruz pickup truck offers both utility and sports features. In the EV and HEV
sectors, the electric IONIQ6 is known for its long-range capability and performance.

Price: Hyundai uses a competitive pricing strategy that focuses on price effectiveness. Hyundai
is able to provide similar and even better features and quality while the prices and interest rates
of its cars are lower than its competitors (TBH,T. 2023). The Elantra starts at an MSRP of
CA$24,506, which is less than its competitors such as the Honda Civic (lowest MSRP of
CA$28753) and Toyota Carolla (lowest MSRP of CA$26164). Although the Elantra is in the
economical category, its luxurious design and high-end features help it stand out from other
conventional models in the economy class.

In the EV market, Hyundai’s IONIQ5 electric SUV is priced at CA$ 54,999, which makes it a
direct competitor to Tesla’s Model 3 (CA$ 53,990) and Model Y (CA$ 57,990). The IONIQ5
shares similarities with Model 3 and Model Y, such as its emphasis on long-range, well-designed
interior, extensive room, and advanced safety features. In contrast to General Motors’ pricing of
EVs to avoid direct competition with Tesla, Hyundai’s positioning of IONIQ5 makes it an
alternative to some of Tesla’s products.

Position: Hyundai vehicles are sold in 193 countries through 5,000 dealerships and showrooms
(The Korean Herald, 2024). In Canada, Hyundai has its dealerships in most provinces except
Yukon, North-West Territories, and Nunavut. The vast deployment of its dealerships shows
Hyundai’s ambition as a world-leading automaker and its robust market status in the market.
Like typical automakers, Hyundai allows customers to do “Build and Price” on its website and
contact the dealership.

The Bluelink system developed by Hyundai is a mobile application that allows users to access
convenient functions such as starting the vehicle, locking the doors, and checking vehicle status
remotely through smartphones and watches . Developing Internet of Things applications has
been becoming a trend in automakers and Hyundai is one of them. Deploying its apps on
smartphones helps Hyundai enhance its presence in people’s lives.

Promotion: Hyundai conducts its promotional activities through IMC by using a mix of media,
advertisements, sales promotions, sponsorships, and events. On social and mobile media,
Hyundai utilizes platforms like YouTube, Facebook, and Instagram to broadcast its
advertisements in the form of videos and digital posters to inform and remind consumers of its
new models and special offers. Hyundai has 1.32 million followers on Instagram, showing its
strong presence on social media.

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Hyundai also employs the influencer and event sponsorship marketing strategy to boost its
public relations and market presence. Hyundai has been a major sponsor of FIFA since 1999
(Xaif, 2023) and a sponsor of the National Hockey League in 2023. These sponsorships help
Hyundai amplify its influence and recognition in the sports community.
On the product selling level, Hyundai offers limited-time special offers as sales promotions. In
2023, Hyundai announced its special offers through advertisements on social media as a
celebration of its 40th anniversary in Canada. This sales campaign is designed to emphasize its
rich history and draw consumer interest with attractive offers and deals.

3.2.3 Hyundai SWOT Analysis

Strengths: The major strengths of Hyundai include its design, price, and deployment of
products in both the ICE vehicle and EV market. Hyundai was founded in South Korea, a
country famous for its contemporary arts and designs. By utilizing its strength in design,
Hyundai can provide cars with more aesthetically pleasing exterior and interior, which may
attract a particular group of customers, or add value to its marking in people’s minds. In 2023,
Hyundai was given the International Forum (iF) Design Award for the design of IONIQ 6(HMG
Newsroom, 2023).

As mentioned above, Hyundai’s vehicles are famous for their price effectiveness and quality.
Hyundai offers its EV models as direct competitors of Tesla Model 3 and Model Y, while it may
provide more features and better quality than Tesla cars, which gives it the potential to persuade
some Tesla customers to shift to Hyundai.

Weaknesses: One of Hyundai’s weaknesses is having a poorer brand perception. The lower
price of Hyundai’s products boosts its sales. On the other hand, along with the stereotype of
poorer qualities of Hyundai’s products, lower prices may result in consumers perceiving it as a
lower-tier brand, which is detrimental to its reputation in the middle and high-end market.4

Opportunities: Hyundai’s opportunities are in two different sectors. By continuing to develop

and promote its well-established EV and HEV products, Hyundai has the opportunity to secure a
larger share of the future automobile market as one of the forerunners with extensive
experience. On the other hand, Hyundai’s economy-class products are famous for their fuel
efficiency, which allows them to better withstand the strike from the rise of EVs. This advantage
gives Hyundai the opportunity to retain certain segments of customers to stay longer with its ICE
products, the sector they have better experience and profitability.

Threats: A major threat Hyundai faces is the intense competition. With the rise of Chinese
domestic automakers, the market share of Hyundai in China has experienced a consecutive
decline for seven years, from 5.49% in 2014 to 1.19% in 2022 (Good Car Bad Car, Hyundai
Sales Figures, 2022). Chinese companies are increasing their investment in EVs and
autonomous driving, aiming at the dominance of the future automobile market. At the same
time, Japanese manufacturers maintain a strong reputation for the quality and technology of

GENTECH 3MB3 MARKETING PLAN REPORT - TESLA MODEL 3 PAGE | 14

their products, seizing a significant portion of consumers. The strength of Chinese and
Japanese automakers continually erodes Hyundai’s market share and status.

3.3 Market Share Breakdown and Comparison of Competition

Products
Tesla GM Hyundai
Market Share in
Canada 2022
(Source:
~2%* 15.4% 7.6%
Automotive
Industry Portal
Marklines)
Market Cap 2021
US$766,756 Million US$38,209 Million US$8,364 Million
(Mergent Online)

Cadillac 2023 CT4

Core Competition V-Series (ICE)
2024 IONIQ5 Long
Product at similar Model 3 (EV)
Range (EV)
price level Chevrolet Bolt EUV
Premier (EV)

MSRP of the Core

CA$52,929 (ICE)
Competition CA$53,990 CA$54,999
CA$43,179 (EV)
Product
EPA Range of EV 438 km 397 km 488 km
*2% is an estimated number, as the market share of Tesla in USA and Canada is 4%, while the
specific data for the Canadian Market is not given

4.0 Target Market Analysis

4.1 Sustainable Visionaries
Strategically aiming to attract forward-thinking and ecologically aware consumers, Tesla targets
the Sustainable Visionaries market category. This group looks for long-lasting and
future-focused solutions, giving sustainability a top priority in their lifestyle decisions. By
providing a range of electric cars with cutting-edge battery technology, autonomous driving
capabilities, and over-the-air updates for enduring and cutting-edge performance, Tesla
complies with these demands. To further demonstrate its dedication to sustainability, the
corporation incorporates green energy solutions, participates in educational marketing
campaigns, and leads community outreach programmes. Resonating with the objectives of
Sustainable Visionaries, Tesla's policy advocacy and strategic relationships further position the
brand as a leader in the pursuit of a more sustainable automotive future.

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4.1.1 Geographic
Sustainable Urban Centers: In Canada, Tesla strategically positions their Model 3 in
sustainable urban centers, such as Vancouver and Toronto, where there is a concentration of
Sustainable Visionaries. These cities are known for their commitment to clean energy and
environmental consciousness. Tesla's marketing efforts capitalize on the environmentally
conscious mindset prevalent in these regions, aligning the Model 3 with the values of Canadian
consumers who prioritize sustainability.

4.1.2 Demographic
Tech-Savvy Generations: Tesla aims at tech-savvy Millennials and Gen Zers who value
innovation and sustainability. This demographic, prevalent in Canadian urban centers, is drawn
to the Model 3's cutting-edge features, including autonomous driving capabilities and
over-the-air updates. Tesla's emphasis on technology aligns with the preferences of these age
groups, positioning the Model 3 as a futuristic and desirable choice.

Affluent Urban Professionals: Tesla strategically targets affluent urban professionals within
Canada for the Model 3. This demographic, often residing in major cities like Toronto and
Vancouver, aligns with the Model 3's premium positioning. Affluent urban professionals are
attracted to the sleek design, advanced technology, and environmental consciousness of the
Model 3, making it a symbol of status and progressive lifestyle in urban settings.

4.1.3 Psychographic
Environmentally Friendly: As an automaker that advertises its products as being
environment-friendly, Tesla targets the group of consumers who are concerned about the
environment and climate change, and who would like to pay a premium to possibly help reduce
emissions. They believe that Tesla’s products and way of manufacturing and energy supply are
advanced and sustainable, which is worth trusting and investing in. Currently, the rise in
Environmental protection awareness and policies about restricting or phasing out ICE vehicles
are driving more people into this group.

Long-term Cost-Effectiveness: Tesla cars also cater to people who emphasize the energy
efficiency of cars. Though Tesla cars may have a higher price than its competing ICE car
models, some consumers believe by using it for a long period, the money saved by using
electricity will eventually surpass the premium paid for Tesla EVs.

Technology and Futurism Enthusiastic Groups: The futuristic design of Tesla cars cater to
consumers who value technology advancements. Besides the looks, the design in functionalities
such as autopilot, regenerative braking, large touchscreens, and the minimalist interior
incorporates a lot of innovative features and drives significant attention. Additionally, the
company also positions itself as the pioneer that leads the automotive industry to the next level
with its cutting-edge and sustainable technologies.

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4.1.4 Behavioural
Performance Focus: thanks to the physical advantage of electrical motors, Tesla cars are
renowned for their advantage in accelerating and controllability. This feature is a key selling
point for the segment in the market that priority the performance of their vehicles. The Tesla
Model S, for example, is equipped with advanced air suspension and traction control systems
(Tesla Inc. 2023). to enhance its stability and agility, which makes it attractive to the group of
customers who are enthusiasts of cutting-edge automotive technologies. On the Tesla website,
most models are advertised for quick acceleration, all-wheel-drive features, and aerodynamic
design, showing that it targets the segment that desires good performance.

City Driving and Commuting: As mentioned above, ICE vehicles are notorious for their low
efficiency at low speeds. The bad traffic in cities and towns, especially in rush hours, causes low
driving speeds and leads to a significant amount of fuel waste and gas emission out of
incomplete combustion, while EVs are perfect solutions to this problem. EVs have lower energy
consumption at low speeds and will not generate more pollution due to frequent braking and
acceleration, making them ideal for short-distance travel.

Tesla targets mid-to-high-class urban commuters. With the growth of the urban population in
Canada and an increasing number of charging stations, more consumers have started choosing
Tesla cars as their daily transportation tools. In 2022, Tesla Canada achieved an 86% increase
in its sales in Canada (Good Car Bad Car Automotive Sales Data, 2023). In 2023, Canada had
a record-breaking 1 million growth of population (Government of Canada, 2023). As a lot of
wealthy immigrants move into cities, Tesla will have further growth in its sales.

5.0 Marketing Mix Product or Service Strategy

5.1 Product/Service Strategy
Launched in July 2017, the Tesla Model 3 quickly became a significant player in the sustainable
vehicle market. In just under four years, the Model 3 became the first electric vehicle to have
surpassed 1 million units sold globally. The Tesla Model 3 positions itself as a premium luxurious
electric vehicle that focuses on range, performance, luxury, and its class-leading charging
infrastructure. A combination of these attributes is the reason that the Model 3 tends to appeal
to a younger (35-44 years old) demographic with a slightly lower (50-100K) income (Tesla Model
3 ‒ An Electric Car for the Masses or Still the Select Few?, 2016).

5.2 Positioning Strategy

Tesla has positioned itself as a premium luxury brand in terms of pricing, design, performance,
and features. Their consumers tend to associate the brand with luxury, exclusivity, and
innovation. When examining Tesla in the electric vehicle and sustainable energy markets, we
can see they lead the segment in terms of technology, commitment to sustainability, and their
sales model. A key aspect of Tesla’s marketing strategy involves direct-to-consumer sales with
their online platforms as well as dealerships in popular areas around the world. This helps them

GENTECH 3MB3 MARKETING PLAN REPORT - TESLA MODEL 3 PAGE | 17

maintain a significant amount of control over customer experience. Although Tesla tends to lead
the market when it comes to electric vehicles, as apparent by their 50.58% market share
(Lesjak, n.d.), it must overcome the hurdle of being a newer company and not having a
long-established reputation such as industry pioneers like Ford, Toyota, and BMW. Therefore,
for Tesla to position itself in the market in the best manner possible, it must exceed expectations
in key areas compared to other EV makers, leveraging their commitment to innovation,
cutting-edge technology, and sustainability. By consistently outperforming industry standards in
terms of range, charging infrastructure, and autonomous driving capabilities, Tesla can
differentiate itself from all other EV manufacturers while simultaneously building a positive
reputation that overcomes any initial lack of brand image, then leveraging that image to
dominate the mid-luxury electric vehicle market.

5.3 Pricing Strategy

Tesla seems to have adopted an interesting yet very non-traditional approach to their pricing
strategy, however, that seems to work with the direction that the company is headed in. While
traditional companies in the automotive space tend to start from lower-end products and slowly
enter the luxury market, however, Tesla took the opposite approach. They decided to build a
reputable brand image for themselves, and then use that perceived quality to demand
competitive prices.

Tesla uses a direct selling model, with 78% of Model 3 sales completed online in 2018, resulting
in a 6% cost decrease. This is due to Tesla's advanced electric vehicle capabilities, charging
infrastructure, autonomous driving, and design. The brand's loyal customers have more
disposable income than most other consumers.

5.4 Promotion and Advertising Strategy

Tesla has a very unconventional approach when it comes to advertising and promotion. Tesla
products and launches tend to gain attention rapidly without it costing them. Their iconic CEO,
Elon Musk is also known for his controversial takes on certain topics, however, he seems to
garner the attention of the public. Just by tweeting on his social media, he can influence many,
therefore acting as a marketing tool. Tesla is essentially able to market itself with virtually no
marketing team or budget. All of their products have a certain prestigious factor in their
respective segments that helps make them attractive in the eyes of the consumer. A
combination of their social media presence and the prestigious factor of their products is why
Tesla is always in the limelight with a loyal and engaged community that stands behind their
products.

Tesla has seemed to master their approach to publicity and customer experience. They have a
long-standing history of performing ‘stunts’ that attract mass media attention such as sending
Elon Musk’s personal Tesla Roadster to outer space in 2018 in partnership with Elon Musk’s
other venture, SpaceX. Another interesting stunt that resulted in billions of dollars worth of free
marketing was the rather serendipitous launch of the Cybertruck. During the 2019 unveiling of
the Cybertruck, Elon Musk was to appear on stage and demonstrate the rigidity of their new

GENTECH 3MB3 MARKETING PLAN REPORT - TESLA MODEL 3 PAGE | 18

armored window, however, the glass window ended up shattering live in front of millions of
people. Despite such an unpredictable launch, Elon Musk and Tesla were able to embrace the
unexpected and leverage this viral moment to retain their playful yet innovative brand image.

6.0 Conclusion
In conclusion, a thorough analysis of Tesla's strategic environment has been provided by this
extensive marketing research. Driven by innovation and a dedication to environmental
conscience, Tesla, a forerunner in the electric vehicle (EV) sector, is at the forefront of
sustainable transportation. The company has established itself as a global leader thanks to its
unwavering pursuit of cutting-edge technology and breakthroughs in autonomous driving and
batteries.

The macro-environmental analysis emphasized the ways in which Tesla's operating

environment is shaped by political, economic, social, technological, environmental, and legal
variables. Notable was Tesla's ability to overcome obstacles, especially when faced with
escalating rivalry from major automakers like Hyundai and General Motors.

The competitor analysis provided insights into the contrasting strategies employed by General
Motors and Hyundai, highlighting their respective strengths and weaknesses in the context of
the rapidly evolving electric vehicle market. Tesla's ability to differentiate itself through
innovation, brand image, and a relentless focus on sustainability has allowed it to carve a
unique niche in this competitive landscape.

The target market analysis, centring on Sustainable Visionaries, illuminated the strategic focus
of Tesla in catering to environmentally conscious consumers. By aligning its marketing efforts
with this segment, Tesla capitalizes on a growing demographic that seeks both sustainable and
technologically advanced solutions in their automotive choices.

The marketing mix, emphasizing Tesla's product strategy, underscored the importance of a
diverse and innovative product lineup. With the Tesla Model 3 at the forefront, the company
offers a compelling combination of style, performance, and sustainability. The incorporation of
autonomous driving features, over-the-air updates, and strategic adaptability to regional
preferences further enhances the attractiveness of Tesla's offerings.

In summary, Tesla's success lies not only in its revolutionary products but also in its adept
understanding of the macro-environment, competitive landscape, target market dynamics, and a
well-crafted marketing mix. As the electric vehicle industry continues to evolve, Tesla's strategic
agility and unwavering commitment to sustainable innovation position it for sustained success
and continued leadership in the automotive market.

GENTECH 3MB3 MARKETING PLAN REPORT - TESLA MODEL 3 PAGE | 19

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GENTECH 3MB3 MARKETING PLAN REPORT - TESLA MODEL 3 PAGE | 24

Good Car Bad Car Automotive Sales Data. (2022). Hyundai sales figures – China market.
GCBC. Retrieved November 25, 2023,
https://www.goodcarbadcar.net/hyundai-china-sales-figures/

7.4 Target Market Analysis

Tucker, S., & Hardesty, C. (2023, October 18). Study: Apart from Tesla, EVs Repairs Not Much
More Costly. Kelley Blue Book. Retrieved November 24, 2023, from
https://www.kbb.com/car-news/study-apart-from-tesla-evs-repairs-not-much-more-costly/
Tesla Inc. (2023). Model S owner’s Manual. Tesla. Retrieved November 24, 2023, from
https://www.tesla.com/ownersmanual/models/en_us/GUID-F1B6801A-8946-41AD-8CF9-7A963
CDA38E4.html

Good Car Bad Car Automotive Sales Data. (2023). Tesla Inc sales figures – Canadian market.
GCBC. Retrieved November 24, 2023,from
https://www.goodcarbadcar.net/tesla-inc-canada-sales-figures/#:~:text=Tesla%20car%20sales%
20in%20Canada,over%20Tesla%E2%80%99s%20sales%20in%202021tml

Government of Canada, S. C. (2023, March 22). Canada’s population estimates: Record-high

population growth in 2022. The Daily -. Retrieved November 24, 2023, from
https://www150.statcan.gc.ca/n1/daily-quotidien/230322/dq230322f-eng.htm

7.5 Marketing Mix Product of Service Strategy

Lesjak, Ž. (n.d.). Tesla Sales Q3 2023: Production & Revenue (Statistics Update). Tridens
Technology. Retrieved November 16, 2023, from
https://tridenstechnology.com/tesla-sales-statistics/

Tesla Model 3 ‒ An Electric Car for the Masses or Still the Select Few? (2016, April 5).
Quantcast. Retrieved November 16, 2023, from
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till-the-select-few/

Holland, M. (2019, March 3). 78% Of Tesla's 2018 Model 3 Sales Were Online — Musk Email
Sheds Light On New Sales Strategy. CleanTechnica. Retrieved November 16, 2023, from
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sheds-light-on-new-sales-strategy/

GENTECH 3MB3 MARKETING PLAN REPORT - TESLA MODEL 3 PAGE | 25

APPENDIX A
Tesla Emissions Report

Figure 1: a page in the Official 2022 Tesla Impact Report Highlights claims that a single Tesla
vehicle avoids 55 tons of CO2e emission in its whole product life (CO2e refers to “Carbon
dioxide equivalent”, which describes different G.H. gases in a common unit)

Vehicle Comparison - Tesla Model 3 vs Cadillac CT4 2023

As the following chart shows, as a competitor of the Tesla Model 3, the Cadillac CT4 V Series is
offered at a lower vehicle price, whereas its theoretical energy cost per km is about 12 cents
higher than the Tesla Model 3.

A Brief Comparison of the Vehicle Price and Theoretical Energy Cost per KM of
Tesla Model 3 and Cadillac CT4 2023
Tesla Model Cost of fully Theoretical Energy Cost Vehicle Price
3 Standard charging the Range per Kilometer
Version vehicle during
Battery kWh Ultra-Low
Overnight Period
in Ontario
57.5 kWh CA$1.61 @ 2.8 438 km 3.7 cents/km CA$53,999
cents /kWh

GENTECH 3MB3 MARKETING PLAN REPORT - TESLA MODEL 3 PAGE | 26

 2023 Cost of fully Theoretical Energy Cost Vehicle Price
Cadillac fueling the Range Based on Per Kilometer
CT4 vehicle for #91 Average Fuel
V-Series Gasoline Priced Consumption of
AWD Fuel 160 cents/L 10.2L /100km
Capacity
64 L CA$102.4 @ 160 626 km 16.4 cents/km CA$50,373
cents /L

Tesla Charging Stations Map

Figure 2: From the brochure page of Tesla Model 3, showing the deployment of Tesla charging
stations in North America.

GENTECH 3MB3 MARKETING PLAN REPORT - TESLA MODEL 3 PAGE | 27