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What Does the Success of Tesla Mean for the Future Dynamics in the Global Automobile Sector?

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  • Perkins, Greg
  • Murmann, Johann Peter

Abstract

After reading Jacobides, MacDuffie, and Tae (2016), the success of Tesla in launching a new automobile company in a crowded sector puzzled us. Jacobides, MacDuffie, and Tae (2016) had convinced us that developing the capabilities to become the manufacturer of a complete, safe automobile system would be quite difficult. Since the establishment of the dominant design for the auto in the 1920s, the industry has operated on the premise of massive economies of scale. Original equipment manufacturers’ (OEMs) role in taking responsibility for the legal liability of the whole automobile, combined with their extensive supply and marketing chains, has ensured they remained dominant in the sector despite some missteps with modularisation and outsourcing efforts (Jacobides, MacDuffie, & Tae, 2016; Schulze, MacDuffie, & Taube, 2015). No major component supplier has succeeded in forward integrating into becoming an OEM and no new entrants have challenged the dominance of the incumbent OEMs since the earliest days of the auto industry (Jacobides & MacDuffie, 2013).

Suggested Citation

  • Perkins, Greg & Murmann, Johann Peter, 2018. "What Does the Success of Tesla Mean for the Future Dynamics in the Global Automobile Sector?," Management and Organization Review, Cambridge University Press, vol. 14(3), pages 471-480, September.
    • Handle: RePEc:cup:maorev:v:14:y:2018:i:03:p:471-480_00
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    Cited by:

    1. Alvarez León, Luis F. & Aoyama, Yuko, 2022. "Industry emergence and market capture: The rise of autonomous vehicles," Technological Forecasting and Social Change, Elsevier, vol. 180(C).
    2. Butollo, Florian & Gereffi, Gary & Yang, Chun & Krzywdzinski, Martin, 2022. "Digital transformation and value chains: Introduction," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 22(4), pages 585-594.
    3. Greig Mordue & Erman Sener, 2022. "Upgrading in the Automotive Periphery: Turkey's Battery Electric Vehicle Maker Togg," Development and Change, International Institute of Social Studies, vol. 53(4), pages 760-795, July.
    4. Kangsik Choi & Seonyoung Lim, 2024. "Vertical Strategy with Quality Differentiation in an Import-competing Market," Journal of Industry, Competition and Trade, Springer, vol. 24(1), pages 1-21, December.
    5. Haessler, Philipp & Giones, Ferran & Brem, Alexander, 2023. "The who and how of commercializing emerging technologies: A technology-focused review," Technovation, Elsevier, vol. 121(C).
    6. Michael Naor & Alex Coman & Anat Wiznizer, 2021. "Vertically Integrated Supply Chain of Batteries, Electric Vehicles, and Charging Infrastructure: A Review of Three Milestone Projects from Theory of Constraints Perspective," Sustainability, MDPI, vol. 13(7), pages 1-21, March.
    7. Szalavetz, Andrea, 2022. "Transition to electric vehicles in Hungary: A devastating crisis or business as usual?," Technological Forecasting and Social Change, Elsevier, vol. 184(C).
    8. Clara Turner & Marco R Di Tommaso & Chiara Pollio & Karen Chapple, 2020. "Who will win the electric vehicle race? The role of place-based assets and policy," Local Economy, London South Bank University, vol. 35(4), pages 337-362, June.
    9. Wen, W. & Yang, S. & Zhou, P. & Gao, S.Z., 2021. "Impacts of COVID-19 on the electric vehicle industry: Evidence from China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 144(C).
    10. Philip Cooke, 2020. "Gigafactory Logistics in Space and Time: Tesla’s Fourth Gigafactory and Its Rivals," Sustainability, MDPI, vol. 12(5), pages 1-16, March.

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