Tesla Motors is one of the numerous automobile manufacturers in the US. The automaker is responsible for the development of the Tesla Roadster which is an electric sports car that is a novel creation as opposed to other similar cars. While the Chevy Volt and the Nissan Leaf can only run for 40 and 100 miles respectively, the Roadster provides its drivers with more than 245 miles in battery technology. The vehicle is also pretty fast as it is able to accelerate from naught to 60 miles an hour in just 3.7 seconds. This quality of the product has been a key factor in the significant rise in stock value of the company since production begun in 2008. It is important to note that unlike popular practice in the automation industry where the manufacturing process is conducted in areas of cheap labor, Tesla’s location is in one of the most expensive areas in terms of cost for real estate and wages for the technical personnel (Karamitsios, 2013). This is elaborated further in the description of the supply chain of the organization.
Participants in the Supply Channel
The American automaker, Tesla Motors, has its headquarters in Palo Alto where much of the production of its vehicles is conducted. Many of the automobile manufacturers are shipping their production of various parts to low cost labor areas. For instance, Ford Motor Company is creating a $1.6 billion factory in Mexico. Alternatively, Tesla established the Gigafactory just a few kilometers east of Reno, Nevada (Karamitsios, 2013). The production is a joint venture between Tesla and Panasonic which is intended to create lithium-ion battery cells in massive numbers. However, it is evident that other parts of the vehicle are supplied from other parts of the world with nearly 300 suppliers, approximately 50 of them are in Northern California and another 10 are found in San Francisco Bay Area (Karamitsios, 2013). SAS serves as the company’s dashboard supplier and is located just next to the company factory. The Eclipse Automation and Futuris Automotive Group both found near the company factory in Palo Alto (Tsay, 2014). The body panels of the Tesla vehicles are sourced from Sotira Automotive a French based supplier located in Meslay du Maine. BorgWarner located in Auburn Hills, Michigan is responsible for creation of a single-speed gearbox. Siemens AG in Berlin, Germany supplies the automaker with brakes and airbags (Tsay, 2014).
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Mode of Transportation used between each stage in the channel
The company usually engages in a diverse mode of transportation depending on the location of the assembly plant and the source of the supply. The different parts of the vehicle are gathered from the different suppliers where they are then used to build the finished product (Karamitsios, 2013). According to the company reports, it is evident that train transportation is the most preferred mode of transportation as it allows minimal damage as opposed to using trucks which are more likely to be affected by accidents (Tsay, 2014). The company prepares the different models of the vehicle in Fremont, California where they are tested for effectiveness. The electric motor and other parts are then separated for shipping to Europe and negotiations are underway to begin assembly in China.
Name and Location of the Component Parts of the Product
There are a number of parts and components that make up the car. For instance, the lithium ion battery pack is produced in two significant types the 60kWh and 80kWh models (Tsay, 2014). This important component of the vehicle is produced in Reno, Nevada. The dashboards of the vehicles are sourced from SAS within San Francisco Bay area while body panels come from France and gearbox from Germany (Karamitsios, 2013). As mentioned earlier, the different parts are shipped separately to the assembly point for building the final product.
References
Karamitsios, A. (2013). Open innovation in EVs: A case study of Tesla Motors. KTH Industrial Engineering and Management , 1-30.
Tsay, A. A. (2014). Designing and controlling the outsourced supply chain. Foundations and Trends in Technology, Information and Operations Management , 7(1–2), 1-160.
