Diversification strategies involve a firm stepping beyond its existing industries and entering a new value chain. Generally, related diversification (i.e., entering a new initiative that has significant similarities with a firm’s existing industries) is wiser than unrelated diversification (i.e., entering a new industry lacking such similarities).
Before writing your initial discussion post, read Tesla’s Entry into the U.S. Auto Industry (Attached)
Tesla recently engaged in diversification by entering the auto industry. Explain why they made this expansion to their portfolio.
Do you find the reasoning to be convincing? Explain why or why not in your response.
Provide one (1) additional example of future diversification the organization could take next. Explain your rationale behind this selection.