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
interesting perspective! If you would like to get an additional perspective, I have packed many more details into my book: https://teslaficationbook.com/
Among them first principle thinking in terms of product and manufacturing design.
Incredible newsletter as always. Nicely done and thanks for sharing your wisdom. Missing your class already
Thanks David for the kind words! I am missing class as well.
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
First Thanks!
I also completely agree. Their vertical integration is becoming a bigger and bigger differentiator for Tesla.
hi Gad,
interesting perspective! If you would like to get an additional perspective, I have packed many more details into my book: https://teslaficationbook.com/
Among them first principle thinking in terms of product and manufacturing design.