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How Did Tesla Use Strategic Partnerships To Stay In Business?

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While Tesla designs, manufactures, sells and services their own vehicles they recognize that due to the company being one smallest auto manufacturers in the world that they needed strategic partnerships to stay in business. The first partnership that Tesla entered into was being with Daimler in 2010. For a 10% stake in Tesla, Daimler got Tesla’s lithium-ion battery packs into 1,000 of its electric smart cars. With the infusion of capital from Daimler, Tesla could continue with their research and development and stay in business. The investment also enables the two companies to work together further on the battery systems and electric drive systems. In 2011, Toyota acquired a 3% stake in Tesla and in return Tesla agreed to collaborate with Toyota on its first electric car. The electric car for Toyota was the company’s RAV4 model and Tesla was responsible for ‘supplying all of the RAV4’s electric powertrain components, including the motor and lithium-ion battery pack” (Dobrinova, 2012, para. 3). Besides the capital that Toyota and Daimler invested into Tesla to keep the company going they …show more content…
Tesla CEO Elon Musk (2016) has said that to meet the aggressive production goals, Tesla would be dropping suppliers who could not meet the lead time goals. This makes lead time the most important part of any Supplier Contract that Tesla currently enters into. Musk (2016) also went on to say that Tesla will be moving a lot of their outsourced components in house, in order to reduce risk throughout their supply chain. This can be expensive, but if Tesla does choose to move more production in house, it would mean less suppliers. Less suppliers would mean that there would be less suppliers, and consequently less supply contracts. This could reduce some of the supply chain management tasks within Tesla, but it remains to be seen if they will make this

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