A few weeks ago, I visited the Tesla plant in Fremont —the original NUMMI plant which was Tesla’s first production line. But actually, the plant that’s making headlines these days is the one being built in Monterrey, Mexico, where Tesla is planning to test a new way of making cars.
Incredible newsletter as always. Nicely done and thanks for sharing your wisdom. Missing your class already
Apologies for the premature send. The second paragraph should read:
If this really is hard for traditional firms to copy because of their supply chain model, a consequence of Tesla succeeding in this would be additional cost differentiation for a sustained period.
Awesome article. Thanks. Only thing I would add is that I’d think Tesla’s emphasis on vertical integration makes a move like this much easier than it would be at a traditional automaker reliant on suppliers to design and build their own components. But I am also not deeply familiar enough with those firm relationships to know how much that matters. It reminds me of the Coase’s theory of a firm and transaction costs.
If this really is hard for traditional firms to copy because of their supply chain mod, a consequence of Tesla succeeding in this would be additional differentiation that others