Operations at Tesla Inc.

Introduction

Tesla Inc. is an American automotive and energy company that was established in 2003 and based in California. The company is involved in the electric car manufacturing and production of solar panel through one of its subsidiaries. The company is known to operate different production facilities. Tesla Inc. has taken up the wave of electric cars and commitment to satisfy the growing demand.

Key Activities

Tesla company is engaged in the manufacture of electric vehicles, scalable clean energy generation, and storage products. The key activities at Tesla include the electronic manufacturing services model of production. Tesla is involved in the manufacturing of the electric sports cars, the operation of a distribution chain all over the world, and investment in charging station (Petri, 2015). Tesla is also engaged in the production of car batteries, which is an essential element in the performance of electric cars.

Critical Activities Performed by Tesla

Tesla has been noted to have adopted a model, “We’ll do it ourselves, we’ll change the mold.” This philosophy has seen the company engaged in the production of most parts of the vehicle including seats. Among the activities that are handled internally by Tesla include design and building bulks of its vehicles. Tesla also handles components of software development for the car’s systems. Tesla is also known to manage its chain of car dealerships all over the world (Bilbeisi, & Kesse, 2017). 

Key Partners

It is indicated that Tesla has more than 150 suppliers distributed throughout the world. These suppliers are engaged in the supply of more than 2000 different parts (Mangram, 2012). Among the key partners include Chei Mei OptoElectronic that supplies the displays in the car, Garmin supplies the navigation systems, NVIDIA TEGRA 3 processor is used to run the electronics in the vehicle, and modems are supplied by Sierra Wireless and used to run broadband on the AT & T network. Panasonic is the strategic partner for developing battery packs.

Success Measures

It is noted that Tesla rarely uses traditional metrics such as market penetration and market share. While market share was widely used, Tesla is noted to rely on a share of profits. This was evident in 2017 when Forbes reported that Renault-Nissan was the global electric market leader in 2017 having sold 1.5X more units than Tesla for the first quarter. Tesla recently reported that it expected its gross margins for Model to hit 25% in 2018 and noted to be twice as high as gross margins as Ford and GM (Yoon, 2017).

Conclusion

The discussion above indicates that the key activities at Tesla include the electronic manufacturing services model of production. Among the key critical activities that are performed by Tesla internally and never outsourced include design and building bulks of its vehicles, software development, and managing its chain of car dealerships. Among the Tesla’s key partners include Chei Mei OptoElectronic, Garmin, Sierra Wireless, and Panasonic. Tesla is known to rarely uses traditional metrics such as market penetration and market share but rather uses share of profits.

References

Bilbeisi, K. M., & Kesse, M. (2017). Tesla: A Successful Entrepreneurship Strategy. B> Quest.

Eusk, M. (2017). Tesla Versus the World: Can Insourcing Beat Outsourcing. Harvard Business School, Technology and Operations Management. Retrieved from https://rctom.hbs.org/submission/tesla-versus-the-world-can-insourcing-beat-outsourcing/

Lehtinen, P. (2015). The advancement of electric vehicles-case: Tesla Motors. Disruptive technology requiring systemic innovating (Master’s thesis).

Mangram, M. E. (2012). The globalization of Tesla Motors: a strategic marketing plan analysis. Journal of Strategic Marketing, 20(4), 289-312.

Yoon, E. (2017). Tesla Shows How Traditional Business Metrics are Outdated. Harvard Business Review. Retrieved from https://hbr.org/2017/08/tesla-shows-how-traditional-business-metrics-are-outdated