Tesla Inc. makes most of its sells to the west coast demographic. In the first nine months of sales, 50 percent were sold in California (Caldwell, 2016). The following states are that are included in that area: California, Oregon, and Washington. Current customer demographics are made up of baby boomers, millennials, and previous Tesla owners. The average buyer has an income moderate to high income and are educated individuals. Males are also the predominant buyer of Tesla’s by making up 70% of the purchasers. The current customer is also tech savvy, environmentally conscious early adopters who see Tesla as an innovative brand that meets their needs (Krisher, 2016). The current customer is also between 45-54 years old.
Analysis of the potential market for Tesla must factor in the company’s future and current plans. Tesla plans to release the fastest accelerating car from 0 to 60 mph in 2020, and the company also intends to issue a self-driving lorry, the first of its kind (“Demographic of Tesla”). Additionally, the company is differentiating its product into three categories; eco-friendly, tech-savvy, and entry-level luxury buyers to attract younger customers from 20 to 40 years old (Zucchi). The younger generation is increasingly concerned about the pollution caused by gasoline, unlike the older customers who bought Tesla automobiles partly because of high income and because they felt fuel prices were rising too high. Therefore, Tesla vehicles are more attractive to them. Additionally, the fast acceleration of future models appeals to the youth and new drivers. Tesla also started selling used cars in 2015 which are more affordable for young people. (Korosec, 2015).
California is one of the states with the highest demand for Tesla automobiles with 42.5 percent market share (Korosec, 2015). Further, statistics show that in 2016, the state issued 26.2 million new driving licenses, the most significant number in the country (“Total licensed drivers”). Most of these drivers were young people who had just turned the legal driving age with valid licenses at 18. Also, the product differentiation of Tesla allows young people to shop according to their tastes which increases the potential market. Statistics also show that 51 percent of drivers are female and only 49 percent are males (“Demographic of Tesla”). Additionally, men are more likely to purchase Tesla brands with 70.5% of owners being male and only 29.5% for women (“Demographic of Tesla”). Therefore, differentiation of the brand should target the more significant number of female drivers who do not own Tesla cars.