Case Assignment: Tesla Motors

Tesla Motors was founded with innovation in mind. Launched in2003 by a group of engineers in Silicon Valley who wanted to provethat electric cars could replace gasoline-powered automobiles,Tesla’s mission is to accelerate the world’s transition tosustainable energy.

           The Tesla Roadster was launched in 2008 and can travel 245 milesper charge of its lithium ion battery. There are now more than2,400 Roadsters being driven in more than 30 countries. TheRoadster was followed by the Tesla Model S in 2012. The Model S cantravel 265 miles per charge and has room for seven passengers with64 cubic feet of storage. The Model S was named Motor Trend’s 2013Car of the Year and achieved a 5-star safety rating from the U.S.National Highway Traffic Safety Administration.

           Next came the Model X, which Tesla began delivering in 2015, andthe new Model 3 will begin production in mid-2017 with estimateddelivery for new reservations at mid-2018 or later. Model 3 isTesla’s most affordable model to date, starting at $35,000. It hasseating for five adults and can travel 215 miles percharge.

           Improvements to battery life and safety features weren’t the onlyupgrades Tesla had quietly been putting together. They created aroar in the automobile industry when they announced in October 2016that, moving forward, all vehicles produced in Tesla factorieswould have the hardware needed for full self-driving capabilitiesat a safety level higher than that of a human driver. Model S andModel X vehicles with the new hardware are already in production,and the hardware will be included on the new Model 3 when it goesinto production.

           This hardware includes eight surround cameras providing 360-degreevisibility around the car up to 250 meters of range; two updatedultrasonic sensors; forward-facing radar that can see through heavyrain, fog, dust, and even the car ahead; and a new onboard computerwith more than 40 times the computing power of previousgenerations.

           Tesla’s move was unprecedented compared to that of other carcompanies, but not as much for them. While Tesla will be creatingcars with the hardware needed for self-driving capabilities, theydo not have the software finished yet. They will update thesoftware in the cars produced now using over-the-air softwareupdates. This is a method that Tesla already employs to enhanceperformance and fix security bugs; it allows them to continuallyimprove cars even after they are on the road and to stay ahead ofautomakers who do not operate under this model.

           Tesla still has to complete millions of miles of real-world testingbefore the software can be implemented. They will run the softwarein the background while a professional drives the car and thencompare what the computer would have done with what the person diddo. The goal is for self-driving cars to be even better than humansat avoiding crashes.

           Tesla must also achieve regulatory approvals of full self-drivingcars before they can legally drive on public roadways. So it isstill unclear when customers (even those currently purchasingmodels featuring the new hardware) will be able to experience fullyautonomous driving.

TRUE/FALSE

1.Telsa’s new products have been successful, in part, because theyhave a well-defined new product strategy at their core and aredriven by the corporate objectives and strategies of usingelectricity over gasoline when designing automobiles.

ANS:

2. Anew-product strategy is a plan that links the new-productdevelopment process with the objectives of the marketingdepartment, the business unit, and the corporation.

ANS:

3. Thebusiness analysis to determine if Tesla should equip their carswith the self-driving hardware before the software was completewould have been a simple process.

ANS:

4. Teslaemployed simultaneous product development by having their hardwareand their software design teams work together on the autonomousautomobile initiative.

ANS:

5. Teslawill use test marketing to teach the self-driving software how toappropriately respond in different driving situations.