The world is enamored with Tesla. Auto journalists praise its cars and financial analysts constantly tout the company’s potential. But there’s a critical problem with Tesla’s product strategy: it’s not actually disruptive, which will likely cause it to struggle to scale. This may seem like heresy—even the analysts who are bearish on Tesla in the short-run are bullish on its long-term potential. But Telsa is starting from the top of a market, selling high-end vehicles at high prices. To scale, Tesla will eventually have to grow down market but there are real impediments to doing so. That’s why the most successful innovators usually do the reverse.
Why Tesla Won’t Be Able to Scale
Their high-priced model will hold them back.
April 23, 2015
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Accelerate your career with Harvard ManageMentor®. HBR Learning’s online leadership training helps you hone your skills with courses like Innovation and Creativity. Earn badges to share on LinkedIn and your resume. Access more than 40 courses trusted by Fortune 500 companies.
Unlock your team's curiosity and willingness to take smart risks.