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*New*Unit 5 International Business:P5 - Explain the external factors that influence a selected business considering trading internationally.
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*Certified High Graded Work* *New*Unit 5 International Business:P5 - Explain the external factors that influence a selected business considering trading internationally. Learning aim C: Investigate the external factors that influence international businesses - C1 External influences • Factors...

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  • July 21, 2024
  • 6
  • 2022/2023
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source supplies and labour from other nations while selling in the same market might have a
big influence on its competitiveness in the near term, boosting costs and restricting trade. Aside
from the fact that Tesla vehicles are among the best-selling in the country, existing regulation
prevents British drivers from participating in Tesla's complete self-driving beta programme.
There are several possible risks and safety concerns linked with Tesla's advanced driver
assistance system (ADAS), which features a range of automated driving capabilities, which is
why driving in self-driving mode is forbidden in the UK until 2025.

L.A.C.P5
Explain the external factors that influence a selected business considering
trading internationally


Introduction:

In this assignment, I will be undermining and assessing the external factors which entails
Political, Economic, Social, Technological, and Legal and lastly environmental factors that would
have ultimately affected Tesla ability to thrive when operating in the international trade
market. PESTLE analysis is a valuable method for evaluating the numerous elements that might
influence a company's international commerce. In the case of Tesla, political risks, changes in
worldwide demand for electric vehicles, customer perceptions, technological breakthroughs,
regulatory compliance, and environmental concerns may all have an impact on the company's
operations. As a result, in order to retain its competitive position in the worldwide market,
Tesla must continuously analyse these aspects and change its plans accordingly.


PESTLE FACTORS AFFECTING Tesla:


Political factors:

Policies, rules, and regulations enacted by the government can have a
significant influence on enterprises. A change in tax rules, for example, can have an impact on a
company's profitability, whilst new regulations may raise the cost of doing business. Political
stability is also vital; doing business in a country that is in political instability can be dangerous.
Companies must be aware of these issues and ready to adjust to changes in the political
climate. For example, a multinational corporation in a nation with high import tariffs will be at a
disadvantage compared to a company operating in a country with low tariffs.Tesla operates in
several countries and is subject to the rules and regulations of each one. In each area, the
corporation must manage diverse legislation and policies concerning electric vehicles and

, renewable energy. In the United States, for example, the government has granted tax breaks
for electric vehicles, which has increased demand for Tesla's goods. Changes in trade policy,
tariffs, and customs laws, as well as political and government stability, can all have an influence
on Tesla's operations. To reduce risk, Tesla may engage in government relations and lobbying
operations in each market to influence legislative choices that impact the firm. Furthermore,
Tesla may focus on spreading its activities across various regions in order to mitigate the impact
of any political concerns in one country. Furthermore, in 2019, a political crisis in China caused
demonstrations and logistical difficulties, making it harder for Tesla to import vehicle
components and hurting production at their Shanghai facility. Tesla can mitigate this risk by
investing in lobbying activities to influence government laws pertaining to trade and tariffs.
They might also spend in developing ties with government officials to learn about prospective
changes in legislation and policies.


Economic factors


Consumer spending, firm investment, and the general health of the economy can all be affected
by the status of the economy. Interest rates, changes in taxation, advances in technology
inflation, and unemployment are important economic indicators. Economic downturns can
result in fewer consumer spending and lower firm profits, whereas economic development can
result in more demand and better profits. Economic elements such as GDP, inflation, interest
rate, balance of trade, currency rate, and so on are critical in establishing a country's overall
economic climate. These factors can have a direct influence on customers' capacity to acquire
goods and services, as well as on total product demand. Economic conditions may have a
significant influence on international trade. A recession in a large market, such as the United
States or China, for example, might lead to lower demand for Tesla's products and lower
exports. Moreover, inflation can raise the price of goods and services, making Tesla's products
less competitive in the worldwide market. Exchange rate fluctuations can also impact Tesla's
cost of goods and services. Tesla may utilise hedging measures to lessen the impact of currency
changes, as well as emphasis on expanding into new regions to diversify its income sources, to
reduce this risk. Furthermore, Tesla may examine the economic situation of each market with
which it trades and alter its foreign trade strategy appropriately.


Sociocultural factors

A corporation's social and cultural environment may have a substantial influence on consumer
behaviour, staff attitudes, and overall corporate culture. Consumer demand for a company's

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