Suppliers Pressured By Tesla To Steer Clear Of BMW, Mercedes-Benz

2 months ago by Steven Loveday 11

Tesla

Tesla Acquired Grohmann Engineering (Image Credit: flickr via TC)

A couple of months back, Tesla acquired German supplier Grohmann Engineering, and now Elon Musk is calling the shots.

A report from finanzen.net revealed that Elon Musk doesn’t want Grohmann supplying BMW and Mercedes. The company has had such customers in the past, but now that Tesla owns the German supplier, it doesn’t really make sense for “Tesla Advanced Automation Germany” to be working to assist its competitors in advancing their factories.

Mass production of the upcoming Model 3 will require all of Tesla’s resources, and that of

Grohmann’s primary pursuit is building automated plants. In fact, it is one of the most substantial companies in the segment. Without Grohmann, many automakers (mostly of the German luxury variety) wouldn’t possess the automation necessary to build their vehicles.

BMW currently uses Grohmann’s equipment and technology to build its i8 hybrid supercar. BMW has presented awards to the company in the past, including the 2014 Supplier Innovation Award.  As BMW moves forward in its efforts to compete more directly in the electric car segment, against the Palo Alto startup, the company will have to find a replacement for its prized plant supplier.

Aside from Musk and company not wanting to supply its rivals, which isn’t really a surprise – even if the electric automaker could outsource the automation building services – now is not the time for that to be a priority.

The upcoming Model 3 will take every bit of effort and support that Tesla can muster. Also, ramping up production to 500,000 vehicles per year by the end of 2018, will require significant upgrades in automation. As Musk has said repeatedly, it’s about “the machine that builds the machine.” Tesla’s move to a new level of automation is the main reason the automaker acquired Grohmann Engineering.

In related news from this weekend:   Grohmann employees aren’t terrible happy with their wages, and now that deeper-pocketed Tesla is in charge, and have a very time-sensitive product upcoming in the Model 3, are threatening to go on strike.

Source: BMW Blog

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11 responses to "Suppliers Pressured By Tesla To Steer Clear Of BMW, Mercedes-Benz"

  1. Alaa says:

    In case these suppliers didn’t know MB BMW etc want Tesla dead.

    1. Mister G says:

      Pay the union workers what they want and make them happy.

      1. John says:

        Short term, sadly, I agree. The Model 3 must launch on time at all costs. Work out the bugs later.

  2. Mark says:

    Being a supplier is profitable business. It can ill afford to sink capital and reject incoming revenue at this point, even if it does want to grind an ax with the competition.

  3. Some Guy says:

    Grohmann is no longer a supplier. It’s a subdivision of Tesla. There is no pressure here, it’s just a decision by one company to cut business ties with some customers who happen to be competing.
    Tesla building factories for BMW would now be the equivalent of Boing selling parts to a Chinese airplane manufacturer wholesale.

    1. ¯\_(ツ)_/¯ sven says:

      Elon specifically said that his goal was not the success/profitability of Tesla, but the electrification of all automobiles in order to save the human species from extinction due to man-made global warming. I guess that was a bunch of B.S. and a fairy tale spun by Elon, and repeated ad nauseam by his starry-eyed Tesla cult members aka Tesla fanboiz.

      1. Mister G says:

        Elon’s mission hasn’t changed…where’s your evidence?

      2. arne-nl says:

        I guess that mission has already been accomlished with nearly every automaker scrambling to get one or more ‘Tesla fighters’ to market.

        1. Mister G says:

          Not even close to mission accomplished…1% EV market is nothing to be proud of…50% EV market share will be mission accomplished.

  4. Premium Auto says:

    The follow-up story needs to be how Tesla has chosen to direct those remaining in Grohmann management to stop all work on existing contracts and dare companies to sue. Revolutionizing the industry shouldn’t come at the expense of ethics. Oh, and check out Tesla’s other purchases in Tier 2 suppliers to Grohmann.

  5. John Doe says:

    This is no major problem for German automakers, as they have many companies in factory automation. It will only give the others a higher market share.

    It is important for Tesla to automate the factory, and keep it at modern as possible. The other big auto companies are good in factory design, and have experience. To be in that business, they have to be.

    Being a very small manufacturer Tesla is more nimble, and can make changes faster then the huge companies that produce millions of cars.

    That is why BMW and others are setting up highly automated factories for their electric cars. The total man hours for an i3/i8 is very low.

    Renault has made huge design/production changes to the electric drivetrain on the Zoe, and are planning to use a lot of similar components/units in future car models.

    It you can, look at how the waiting time for factory automation has risen in Europe over the last two years. How many they have hired, and how much the companies are investing. Daimler is going to invest over 10 billion Euros on their first large volume production of EVs.

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