The Challenge Case “Tesla Production Will Be Fastest in History” (p. 486) and its related Challenge Case Summary were written to help you understand the management concepts contained in this chapter. Answer the following discussion questions about the Challenge Case to further enrich your understanding of chapter content.

Data from p. 486:

It’s a bold undertaking. Tesla—the electric car manufacturer with an almost cultlike following—will have the fastest ramp-up of production in automotive history. The Tesla Model 3 is the car that will become the standard for the firm as it attempts to go from high-end car company catering to the wealthy to mainstream car manufacturer.

In July 2017, Tesla rolled the first 30 Model 3s off the assembly line. As impressive as that sounds, it’s taken the company 14 years to get to this point. The CEO, Elon Musk, promises that half a million will be made by the end of 2018, and by 2020, 1 million. No other car company has made automobiles this quickly. As a point of reference, in all of 2016, Tesla produced only 76,000 cars. To reach its goal, the company will need to produce more than that each month in the year 2020.

Priced at $35,000, the Model 3 has had a very successful preordering campaign. In just the first week that a customer could preorder the new model, over 325,000 reservations were made, with each order paying a $1,000 deposit. Keep in mind that these customers realized that they would not likely see the car they reserved for a year or two. But this is a testament to what Elon Musk has built. The various models introduced so far have been noted for their ultramodern look, reliable batteries, and surprising power.

1. Why is Tesla attempting to increase production to 1 million units by 2020? From your knowledge of how products, and even cars, are manufactured, do you think the company will meet this goal? Why or why not?

2. List three concepts discussed in this chapter that could help Tesla’s management increase productivity. Be sure to explain how each concept could help.

3. Which concept listed in question 20-5 do you think would have the greatest impact on increasing productivity? Explain fully.