The Supply Chain Management - Tesla Motors

STRATEGIC SUPPLY
CHAIN MANAGEMENT
Tesla Motors

About Tesla Motors and its Supply
Chain
 A leading Automotive Manufacturer headquartered
in California, United States.
 Foundation Year: 2003
 Products: Electric cars, Power-pack batteries, Tesla
Powerwall, solar roof tiles and solar panels (Tesla,
2018).
 It has adopted effective supply chain processes like:
 Production System
 Inventory management
 Online distribution

Supply Chain Sustainability
 Supply chain sustainability is an important aspect
that influences company’s supply chain in context
of risk, environmental and wastage costs.
 It addresses social, environmental and legal sides
of supply chain (Jacobs, and Chase, 2013).
 Tesla Motors implements sustainable practices by
providing electric cars and use of renewable
energy.
 Just-in-Time: It reduces the wastage of raw
materials.

Supply Chain Risk Management
 Process to implement effective strategies to
manage different risks along the supply chain.
 Tesla faces different supply chain risks: Delay in
delivery, maintenance of long-term agreement
with suppliers (Korus, 2016).
 Tesla adopts below processes to handle supply
chain risks:
 Innovation and Efficiency in Supply Chain
Management
 Effective Relationship Management with
Suppliers
 Transparency in Supply Chain

Supply Chain
Synchronization
 Supply chain synchronization starts with
describing the roles and responsibilities
of suppliers and other related partners.
 Tesla Motors develops supply chain
synchronization through “The Tesla
Supplier Portal”.
 It enables different partners to share the
information about supplies (Nykvist, and
Nilsson, 2015).
 Policy of roles and responsibilities

Supply Chain Agility and
Responsiveness
 Agility refers to the capacity of a company to
produce and deliver great quality products
with shorter deadlines.
 Responsiveness is the ability of firm’s supply
chain to fulfill the changing needs of
customers.
 The supply chain of Tesla Motors is very much
responsive and agile (Muysinaliyev, &
Aktamov, 2014).
 It makes the changes in its products as per the
feedback and complaints of customers.

Recommendations
 Tesla Motors should use effective supply
chain strategies to improve its supply
chain management.
 Focus on people, environment and other
related factors.
 Focus on the sustainability.
 Investment on CSR activities
 Implementation of ERP software in its
process.

References
 Tesla. (2018) Model 3, Available from https://www.tesla.com/model3.
[Accessed on 31 May 2018].
 Muysinaliyev, A. & Aktamov, S., 2014. Supply chain management
concepts: literature review, Journal of Business and Management.
 Nykvist, B. and Nilsson, M. 2015, Rapidly falling costs of battery packs
for electric vehicles. Nature Climate Change, 5(4), pp.329-332.
 Jacobs, R. and Chase, R., 2013, Operations and supply chain
management, McGraw-Hill Higher Education.
 Klug, F. (2017). Analysing the interaction of supply chain
synchronisation and material flow stability. International Journal of
Logistics Research and Applications, 20(2), 181-199.
 Korus, S., 2016,
Tesla’s Production Efficiency: The Next Moving Assembly Line, Available
from https://ark-invest.com/research/tesla-production-efficiency.
[Accessed on 31 May 2018].