2. Unable to meet demand might affect brand value Due to highly experimenting and complicated procedures, Tesla’ might face an unbalanced supply and demand, unable to meet the production ramp in the future.
3. Lack of High Volume Production There is no doubt that Tesla is the pioneer of actual energy-saving cars. But it has failed to produce high volumes of automobiles for any of its models. Even now, as the company plans to manufacture Model 3 vehicles at high volume, it faces issues in terms of production cost and management resources and space expansion in Gigafactory 1.
4. Shortage of Batteries In the annual shareholder meetings, CEO Elon Musk accepted that their production rate has decreased due to the limited supply of batteries. The shortage directly affected the sales of electric vehicles and energy storage systems.
5. Elon Musk as Tesla’s Sole Representative Tesla accepts that the company is a ‘one-man show.’ Sadly, that man, Elon Musk has a lot on his shoulders to give his hundred percent to the company. Musk is also deeply involved in other projects like space launch vehicles at Space Exploration Technologies Corporation and The Boring Company.
6. Financial Uncertainty Immense financial capabilities allow companies to compete for market share more effectively. Tesla has outstanding debt of $5.38 Billion. If the company is unable to generate enough cash flow to repay its debt, then there is a risk of delaying expansion, reducing investments, selling assets, etc.
7. Employee Safety Concerns Tesla was recently fined for creating a tent production line without a permit or safety inspection. Also, the company did not train workers about the risks of working in the tent for long periods under the scorching California’s heat. The soaring temperatures in the tent could have caused breathing issues for some employees. [6]
8. Leadership Wrangles Friction and conflict between management and the board of directors can undermine productivity and long-term success. Tesla’s management and board have been engaged in several power tussles. [7]
9. Tesla Faces Lawsuit over Sexual Misconduct
Earlier, six Tesla workers filed a lawsuit alleging sexual misconduct and harassment at the workplace. The women have complained that the company fosters a dark culture of sexual misconduct. They also alleged that they were cat-called and were frequently subjected to shameful remarks, groping, and misogynistic behavior.
