How Tesla Raised Deliveries by 87% in 2021 Despite Global Supply Chain Issues
Tesla delivered a record-breaking 308,600 cars in the fourth quarter of 2021, and a market forecast-beating 936,000 cars in the year as a whole, the electric vehicle (EV) maker announced on Monday.
The numbers represent an 87% growth in deliveries for Tesla year-over-year as compared to 2020.
In a recently published story, Automotive News explores just how Tesla was able to pull that off in a year that knocked most automakers to the ground more than once and rendered parking lots full of basically assembled cars unfit for delivery to consumers simply because they were missing some obscure component.
Tesla’s performance boils down to both excellent supply chain management and keeping as much of the development in-house as possible, allowing the EV pioneer to minimize reliance on third-party vendors and maximize its ability to adapt both hardware and software to alternative components when it runs into supply bottlenecks.
“We design circuit boards by ourselves, which allow us to modify their design quickly to accommodate alternative chips like powerchips,” a Tesla insider said.
Tesla CEO Elon Musk has said the company is “absurdly vertically integrated compared to other auto companies.” Even sales are directly handled by the company.
“We’re designing and building so much more of the car than other (automakers) who will largely go to the traditional supply base and like I call it, catalog engineering. So it is not very adventurous,” Musk said.
And then there’s the elephant in the room — the global chip shortage, which Tesla CEO Elon Musk expects will end (at least for automakers) sometime this year.
While most automakers cut chip orders at the height of the pandemic due to plummeting demand, Tesla banked on growth ushered on by the global transition to sustainable energy and stood its ground in a wager that ultimately paid off.
“They’ve just been smarter about it than other companies in terms of making sure there’s buffer stock,” said an executive for a Tesla supplier. The Wall Street Journal recently covered how the company’s focus on software helped Tesla grow as much as it did amidst a massive silicon shortage.
That’s not to say that Tesla made it out unscathed, though. Supply shortages and increasing component costs drove the company to hike the sticker prices of its offerings at several points throughout the year, going so far as to raise prices on its best-sellers more than once in October alone.