Tesla: The transition from an unknown brand to a luxury brand

A few years ago, I happened to read about an automotive brand named Tesla Motors. As an enthusiast of the automotive industry, naturally I was very interested in this relatively new automotive brand Tesla. The factor that really captivated me was the fact that as an automotive manufacturer they were NOT producing models fitted with an internal combustion engine like practically all vehicles on the road (for a whole century), but innovating the industry by introducing realistic vehicles powered by a battery powered electric motor (EV).

My first impression upon reading the article left me highly skeptical but extremely enchanted. Seeing a completely new alternative to the rest of the automotive offerings was a big deal! But “how would this brand actually succeed?” was my main source of curiosity about Tesla. My skepticism came from two factors: How will Tesla manage to offer an EV that really works well? And how will Tesla actually survive as a brand, when all they offer is a range of EVs that are in the higher price range competing with the flagship models of the likes of BMW, Audi and Mercedes-Benz?

Well, years later I can say with complete confidence that Tesla has now confirmed its status as a luxury automotive brand. In the first quarter of 2013 (United States), they outsold the flagship models of BMW, Audi, and Mercedes-Benz (7 Series, a8, S-class). “How?” you ask? It would seem very unlikely that Tesla would be able to directly compete and beat other luxury automotive manufacturers.

It is because their brand image is associated with quality, performance, quality, and quality. Tesla managed to make an outstanding product, and the way that they market their brand really focuses on the quality factor. In 2014, consumerreports.org announced the results for best overall vehicle rated by consumers: The Tesla Model S, with a staggering 98% saying that they would purchase the vehicle again. Backing up Tesla’s brand image that spoke of quality and lux.

As somebody that previously disliked the idea of a vehicle without an internal combustion engine, I would say now that if I had a chance to purchase a vehicle of a high caliber, there is a good chance it would be a Tesla. They have taken the automotive industry by surprise, establishing themselves as a luxury brand today.

References:

http://www.teslamotors.com
http://www.consumerreports.org/cro/magazine/2014/04/top-picks-2014/index.htm
http://www.eurib.org/fileadmin/user_upload/Documenten/PDF/Merkmeerwaarde_ENGELS/s_-_Brand_equity_model_by_Aaker_EN_.pdf

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About arcticminded

24 year old citizen of the world. Currently studying in Johor Bahru, Malaysia. Skateboarding x Photography x Funfunfun
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3 Responses to Tesla: The transition from an unknown brand to a luxury brand

  1. stanislavkuzmin says:

    Really interisting post about automobile industry and especially Tesla model. It was surprise for me that Tesla outsold BMW, Audi and Mercedes. But how do you think Tesla will develop as a brand in 5 years? I mean, now this car is innovatve and brand new, so at the moment customers didn’t have chance yet to exprerience any faults and damages. But it’ is clear that after first problems that customers may face, they will spread the world in Social Medias.

  2. alexandredoret says:

    I really appreciate your post on the automobile industry. The thing is, and I agree with Stanislav, how Telsa will develop itself in a short a medium term? Because of course as it is mentioned they outsold the famous German brands, but if they are positioning themselves as a luxury brand, their is other competitors who are implemented on the market, with a loyal customers. I think they should have a really good competitive advantage to thrive.

  3. arcticminded says:

    Thank you for the comments. @stanislavkuzmin, I believe that Tesla will continue to surge forward as they expand. By expand I mean the continuous expansion of their charging station infrastructure that is free of charge to Tesla owners (for the time being), the expansion of their automobile lineup (Cheaper variant of the Model S, introduction of more affordable Model X in 2016), and with these two factors Tesla will be able to expand their market size. @alexandredoret You are certainly correct, brands of this caliber do tend to enjoy loyal customers. Tesla has been doing a great job at retaining customers. That being said, it is also important to note that for the time being this is in general a grey area because most Tesla owners have recently (last few years) purchased their first Tesla as Tesla is a fairly new company. The automobiles at the moment are undoubtedly a great package combing sleek aesthetics, great performance and increasing practicality (infrastructure!)! Bright future, I believe!

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