Engineering Tesla is one of founder and CEO Elon Musk’s primary goals for the company, and the benefits the automaker has experienced as a result are multifaceted. For Tesla, the engineering delves into research and development testing, helping the company determine which designs work and which don’t.
Above: Elon Musk closely examining the FANUC robot at the Tesla Fremont plant (Flickr: Steve Jurvetson)
Compared to older automakers, Tesla spends far more per vehicle on research and development costs, rather than spending money on PR, marketing or advertising, according to Motley asshole.
Tesla spent an average of $2,984 on research and development per car produced in 2020, spending exactly $0 on advertising with each car.
By comparison, automakers Ford, Toyota, General Motors (GM) and Stellantis-owned Chrysler spent a significant amount on advertising for each car sold, and much less than Tesla on research and development for each car sold.
Chrysler spent the most on advertising at $664 per vehicle sold, followed by Ford ($468), Toyota ($454) and finally GM ($394). Instead, Chrysler spent the least cost on research and development per car sold at just $784, while General Motors, Toyota, and Ford spent $878, $1,063, and $1,186 per car, respectively.
Tesla’s primary focus is making cars full of useful, well-tested features, relying heavily on engineering and word of mouth to market the automaker’s designs — rather than the traditional marketing tactics, dealerships or other steps taken by most old automakers.
Above: A mechanical design engineer shares his experience working at Tesla (YouTube: Tamer Shaheen)
The result showed the car company could impress with its tech-and-engineering approach first, and Tesla doubled down on the controversial model in 2020, just as it began rising to new heights.
Tesla disbanded its PR division in 2020, and the company did nothing but collapse — it continued to make its way into the S&P 500 and into levels of market capitalization that no automaker has seen yet.
By using software engineering the automaker can implement in-house, and better control of raw materials and condensation to scale cars and the technology it develops, Musk has created a financial giant with Tesla, and one dominant in the electric car vacuum.
Now, with Tesla opening Giga plants in Texas and Berlin-Brandenburg, the automaker will finally be able to produce cars of scale wide enough to earn the “Giga” moniker. More specifically, Tesla will have the opportunity to take full advantage of the engineering framework on which the company is built.
The bottom line is that Tesla’s engineering-first approach has helped the automaker boost margins and gross output, driving up the company’s valuation. In addition, Tesla has used vertical integration to gain greater control over the entire supply chain, effectively reducing middlemen from raw materials to production.
Results? The beginning of a new era for the automobile industry and higher levels of mass adoption of electric vehicles.
source: Motley asshole