![]() ![]() Because if we don't have a supplier base capable of doing that, it certainly would slow us down." To accomplish that, we need a supplier base that is faster and more agile than most automotive companies are used to, which comes down to everything from industrialisation to tooling lead times. ![]() "We really want to be able to develop vehicles in a 2 and a half year time frame. Peter Carlsson, Tesla's VP of Supply Chain, says that Tesla is trying to develop vehicles faster than their competitors. ![]() Other more unique features such as the infotainment system however, have to be designed from scratch. ![]() Partnerships with Daimler and Toyota for instance, help keep costs low for the purchase of some basic component parts. Tesla circumvents some of these these limitations by collaborating with other automobile makers. Due to the nature of their product, Tesla also has to deal with suppliers that don't usually work with car manufacturers at all - such as battery suppliers. This means that unlike many of its competitors, Tesla cannot independently enjoy the same economies of scale. Customers that have paid through this service will also automatically “follow” the company’s updates, allowing customers to feel more engaged with the company as they wait for the delivery of their vehicle.ĭespite Tesla’s phenomenal growth in the past few years, the company is still one of the smallest auto manufacturers in the world. In their Beijing showrooms, Tesla has gone so far as to allow payment through WeChat, China’s most popular mobile messaging app. It’s not an exaggeration to say that Tesla has played an important role in the transformation of the automobile business, particularly in customer-facing practices.Ĭonsumers in the US for instance, can go online to purchase their Tesla and choose amongst a wide array of customisation options. Tesla designs, manufactures, sells, and services through their own sales and service network. Underlying Tesla’s business model is an idea that has been critical to their success - willingness (almost to the extreme) to take complete ownership of the supply chain, from the technological vision of the company to the end consumer experience. None of this however, is possible without an incredibly sophisticated supply chain system that simultaneously reflects Tesla's values.ĭespite being a young company, we can track Tesla’s strategy over time and identify some unique traits that differentiate the company from its competitors. Although some of the mystique may have come about as a result of Tesla’s superhero-like founder Elon Musk, the company’s philosophy has centralised on optimising the consumer experience and bringing to market a product that people really want. Tesla however, stands out as the only EV maker that has truly captured the public’s imagination. There are quite a few companies also in the electric vehicle (EV) business, including formidable automobile giants such as Toyota and Ford. Given the backlash against fossil fuel guzzling cars, it seemed like the golden age of automobile-inspired innovation was over.Įnter Tesla. Ford's assembly line and Toyota's lean manufacturing technique for instance, were extremely valuable for the development of supply chains in other industries. Historically, the automobile industry has pioneered an impressive number of supply chain innovations. ![]()
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