BUSINESS COMMUNICATION

(MGT269)

GROUP PROJECT: BUSINESS PROBLEMS IN TESLA

NO. NAMES ID NUMBER

1 IRDINA BATRISYIA BINTI AHAMAD RIDZWAN 2022524025
2 NOR EYSNINA FITRI BINTI EZAMAL 2022713303
3 NUR FARAHIYAH BINTI ZOL 2022160859
4 NUR AQILAH HAIKAL AMAN 2022746613

SUBMISSION FOR: MADAM KHADIJAH MOHD KUDUS

SUBMISSION DATE: 20 NOVEMBER 2023

 TABLE OF CONTENT

NO. CONTENTS PAGES

Acknowledgement i
Introduction:
1.1 Company background 1
1.2 Problem statements 2
1.3 Significance of the study 3
1
1.4 Scope of the study 3
1.5 Sources and methods of the study 3
1.6 Limitation of the study 3–4
1.7 Definition of term 4–7
Discussion and findings:
2.1 Supply chain challenges of raw material shortage.
2.1.1 Overview of supply chain challenges of raw material shortage in Tesla. 8
2.1.2 The sources and types of raw material used in Tesla’s production. 8
2.1.3 The factors contributing to supply chain disruption. 8–9
2.1.4 The impact of raw material shortage on Tesla. 10 – 11
2.2 Labor aspects
2.2.1 Balancing economic consideration and job security 12
2.2.2 Overview of the labor situation at company Tesla. 12
2 2.2.3 Overview of the current labor situation. 12 – 13
2.2.4 Recent staff lay-offs and the impact to staff 13 – 14
2.2.5 Potential impact of cost-cutting measures on Tesla's reputation 14 – 15
2.3 Safety and brake failure
2.3.1 Tesla's entry factor into China is problematic due to issues in the vehicle. 16
2.3.2 Types of Tesla batteries 16
2.3.3 Factors leading unsafe Tesla batteries 17
2.3.4 The problem of Tesla brake failure has put drivers in danger. 18
2.3.5 Tesla has serious problem with their brake 18
2.3.6 Tesla impact on unsafe batteries and brake failure 18 – 19
 2.4 Low adaptability
2.4.1 The crowded metropolitan roadways of cities restrict the high 20
performance of Tesla vehicles.
2.4.2 Types of adaptability 20 – 21
2.4.3 Factors of low adaptability 21 – 22
Solution from Tesla to the initial problems:
3.1 Solution to mitigate and manage raw material shortage effectively. 23
3 3.2 Solution to improves staff layoff in Tesla company. 24
3.3 Solutions in overhauling battery safety and brake failure. 25
3.4 Solution to improve their adaptability. 26
4 Conclusion 27
5 References 28 – 31
6 Appendix
ACKNOWLEDGEMENT
We would like to show our deepest gratitude to our lecturer of MGT269, Madam
Khadijah Mohd Kudus who helped us so much during this group report. Without her dedication
and patience, we could not reach this far and completed our report in such a tough situation. And
her timely feedback and encouragement inspire us all the time.

Also, to our own group project committee members, Nor Eysnina Fitri, Irdina Batrisyia,
Nur Farahiyah, and Nur Aqilah Haikal. Our collaboration helpful and constructive suggestions in
structure layout and methodology deeply influenced our group report. The support and
encouragement received from each other give us strength to finish this group report together.

Moreover, we want to show our gratitude and respect to all Diploma in Business Studies,
semester 4 for the support. We want to thank you all for constantly helping us out throughout this
group report completion,

i
1. INTRODUCTION
1.1 Company background

Tesla, Inc., previously (2003-2017) Tesla Motors, is an American maker of

electric vehicles, solar panels, and automotive and home power storage batteries. It was
named after Serbian American inventor Nikola Tesla and was launched in 2003 by
American entrepreneurs Martin Eberhard and Marc Tarpenning. (Gregersen & Schreiber,
2021). Nikola Tesla discovering the characteristics of rotating electromagnetic fields. His
effort resulted in "alternating current," the sort of electrical transmission that is being
utilized today. (Reed, 2020)

Eberhard was the CEO of Tesla at the time, while Tarpenning was the CFO. They
founded the company to design and manufacture a totally electric automobile, in part
because of the positive reaction test markets had to General Motor’s. (Reed, 2020). The
firm received funding from a variety of sources, the most notable of which was PayPal
cofounder Elon Musk, who committed more than $30 million to the new enterprise and
served as chairman beginning in 2004. In late 2007, Eberhard resigned as CEO and
President of Technology and joined the company's advisory board. He announced his
departure from the corporation in 2008, however he remained a stakeholder. Tarpenning,
who was vice president of electrical engineering and managed the development of the
Roadster's electronic and software systems, also departed the business in 2008. Musk was
appointed CEO. Tesla's initial public offering in 2010 raised $226 million. (Gregersen &
Schreiber, 2021)

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1.2 Problem statements

Tesla have suppliers not conventional to the auto world as it deals with the electric
powertrain such as, current supply chain challenges. The first challenges that Tesla facing
is raw material is scarce. Tesla utilizes a significant number of raw materials, particularly
in the creation of batteries. As the demand for electric cars develops in the future, there
will be a raw material shortage. For example, aluminum, copper, steel, cobalt, nickel, and
most important material, lithium. (Sujay, 2023). In the future, the increase in demand for
EVs, as well as the output volume of the next 100 gigafactories, might result in a supply
of lithium of lesser than 17 years. (Hunt, 2015)

Secondly, Labor aspects. Staff lay-offs have made it to the headlines, due to which
employees aren’t feeling a sense of job security. These cost-cutting measures can have an
impact on the reputation of the company, as focusing only on the economic aspect of the
triple bottom-line can lead to unsustainable supply chain practices. (Satish, 2020)

Tesla has great opportunities in the Chinese market, but according to the analysis
of the current situation, there is also great risks. Tesla's macroeconomic expectations are
not optimistic, and the industry growth rate is much less than expected. Their factors that
impede Tesla in market is battery safe and brake failure. Tesla’s entry into China was
problematic due to issues within the vehicles. In 2013, a series of fires that occurred in
Tesla vehicles wiped nearly 28% off its market value. While its battery has certain
advantages over other electric vehicles, it is far from meeting public standards. This has
resulted in further decline in the enthusiasm of Chinese consumers who held doubt in
Tesla’s quality control. (Dai & Zhang, 2022)

Finally, is low Adaptability. The high performance of Tesla cars is limited by

congested urban roads. Its powerful performance includes superior acceleration, steering,
grip and handling performance. However, these capabilities are evident in long-distance
driving, but are of little use on China's congested urban road networks. It is clear that the
manufacture did not take into consideration the difference between Chinese urban and its
counterpart in the west. (Dai & Zhang, 2022)

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1.3 Significance of the study

This purpose study aims to investigate the challenges or problems that Tesla
company has been facing while on the market. Tesla is a company that contributes to the
transition to a more sustainable and environmentally friendly transportation industry.
Researching and solving these challenges can help Tesla having strategic decision-
making, its operations will be improved, and the EV industry broadly will see
improvements. It can also help governments and authorities solve challenges like EV
manufacturing, safety, and adaptability for the company, the EV industry, and society.

1.4 Scope of study

The scope of this research includes a thorough study of several challenges that
Tesla, Inc., the largest electric vehicle (EV) manufacturer, is facing. This study will
concentrate on five important problem areas: raw material shortages, labor issues, safety
problems, braking failures, and poor adaptability. Understanding these difficulties is
important for providing conclusions regarding Tesla's operations, their impact on the
company's performance, and prospective improvement plans.

1.5 Sources and methods of study

Research on Tesla's problems, such as raw material shortages, labor issues, safety
concerns, brake failures, and low adaptability, typically involves a multi-method
approach, combining quantitative and qualitative methods, and secondary data, to provide
a comprehensive understanding of the issues and potential solutions.

1.6 Limitation of study

However, this study solely focuses on the company, Tesla, limiting its application
into other firms within the electric vehicles industry due to this reason. Tesla’s experience
may certainly not be an absolute representation of the entire industry since each company
operates under distinct circumstances, having their specific challenges. Moreover, the
environmental problems experienced by Tesla and the entire electric vehicle industry
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remain fluid as they vary with time. The results of this study are likely time bound and
might have missed the most recent problems that may concern the organization or the
industry. Therefore, the findings in this study depend on how reliable the data used is.
Additionally, lack of access to certain proprietary or sensitive information in Tesla can
limit the scope of the analysis and the detail with which the conclusions can be drawn.

1.7 Definition of term

Term Definition

Lithium The lightest metal is used in alloys and glass manufacturing for
improved material qualities. It is primarily used in energy storage,
primarily in rechargeable batteries, which power devices like
mobile phones, laptops, digital cameras, and electric cars. Lithium
is also used in non-rechargeable batteries, such as cardiac
pacemakers, toys, and clocks. It is a key component in energy
solutions, driving advancements in portable devices and sustainable
transportation. (Royal Society of Chemistry, 2022)

Nickel A hard, malleable metallic element with excellent polish and rust
resistance, is widely used in various applications, including alloys
and catalysts. It is crucial in mining for developing alloys like
nickel steel, which is used in armor coating. It also serves as energy
storage in batteries, particularly rechargeable nickel-cadmium and
nickel-metal hydride batteries used in hybrid automobiles. (Royal
Society of Chemistry, 2011b)

Cobalt A transition metal element is widely used in alloys, batteries, paint,

and glass pigments. It can be magnetized like iron, making it useful
in magnet construction. When mixed with aluminum and nickel, it
produces powerful magnets. Cobalt's magnetic properties and
compatibility with various materials make it crucial in modern

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 technology. (Royal Society of Chemistry, 2011a)

Silica Also known as silicon dioxide (SiO2), is a versatile substance

found in various forms like sand, opal, and quartz. It is crucial in
the production of ceramics, glass, artificial stone, and bricks. Due to
its natural properties and frequent use, silica is a common
component in everyday objects, enhancing the practicality and
appeal of various materials. (Occupational Safety and Health
Administration, n.d.)

Tantalum A ductile, gray-white metallic element with excellent acid

resistance, is primarily used in the field of electrical components. It
is found in rare minerals like columbite and tantalite. Tantalum is
crucial in electric cars and clean energy firms for producing
advanced electronic components. Its use in cutting-edge sectors
enhances the capabilities of contemporary electronics. (Royal
Society of Chemistry, 2011c)

Tungsten A gray-white metallic element is used in electrical components,

carbide compounds, and steel alloys. It is crucial in mining,
petroleum, and metalworking sectors due to its strength and
resistance to heat. Tesla uses tungsten for its electric cars due to its
efficiency and strength, highlighting its importance in cutting-edge
technology and environmentally friendly transportation. (Royal
Society of Chemistry, 2011d)

EV A shortened acronym for an electric vehicle. EVs are vehicles that

are either partially or fully powered on electric power. Electric
vehicles have low running costs as they have fewer moving parts
for maintaining and also very environmentally friendly as they use
little or no fossil fuels (petrol or diesel). (The welding Institute,
2023).

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Semiconductor A substance that has specific electrical properties that enable it to
serve as a foundation for computers and other electronic devices. It
is typically a solid chemical element or compound that conducts
electricity under certain conditions but not others. (Zola, 2021)

Geopolitical A study of the influence of such factors as geography, economics,

and demography on the politics and especially the foreign policy of
a state. (Meriam-Webster, n.d.-a)

Cathode The positive or oxidizing electrode that acquires electrons from the
external circuit and is reduced during the electrochemical reaction.
(University of Washington, 2013)

Silicon Carbide A strong, dark-crystalline silicon and carbon combined is a versatile

(SiC) raw material used in various products, including bulletproof vests,
ceramic plates, thin filament pyrometry, and foundry crucibles. It's
also used in the automotive industry, particularly for Tesla's car
clutches. (Wolfspeed, 2019).

Silicon wafers The semiconductors that are utilized for manufacturing microchips
and chips in electronic devices. Integrated circuits are built by these
semiconductors due to the features of the current of electricity
through silicon wafers. (Rose, 2022).

Prismatic The type of battery is designed to provide more power and longer
life than traditional batteries. In fact, the prismatic cell battery is
said to be far more efficient and durable than traditional batteries.
(Tycorun,2022).
Titanium A silvery-gray light strong metallic element with atomic number 22
obtained from ilmenite and rutile and used especially in alloys,
refractory and materials. (Meria-Webster).
Dismantled To carefully take apart or disassemble something, usually a
complex object or structure, into its individual components or parts.
It's like deconstructing it piece by piece.

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Electrolytes Substances that have a natural positive or negative electrical charge
when dissolved in water. They help your body regulate chemical
reactions, maintain the balance between fluids inside and outside
your cells, and more. (Cleveland clinic, 2021).
Membrane A thin soft flexible sheet or layer. (Meria-Webster).
Anode The negative or reducing electrode that releases electrons to the
external circuit and oxidizes during and electrochemical reaction.
(University of Washington, 2013).
Bottlenecks Congestion or obstruction in a process or system. It refers to
situations where the flow or efficiency is limited due to a specific
constraint or bottleneck. It's like when there's a narrow point in a
bottle that slows down the pouring of liquid. In a similar way,
bottlenecks can slow down the overall progress of a task or
operation.

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2. DISCUSSION AND FINDINGS
2.1 Supply chain challenges of raw material shortage.

2.1.1 Overview of supply chain challenges of raw material shortage in Tesla.

Due to a lack of raw materials, Tesla, a significant participant in the

electric vehicle market, is experiencing difficulties in its supply chain. The rise in
demand for essential components such as cobalt, nickel, and lithium (Tesla, 2022)
has resulted in shortages in the supply chain and price instability. Competition and
geopolitical threats make things more difficult, which calls for sustainable
practices and effective supply chain management. (Nikkei, 2023).

2.1.2 The sources and types of raw materials used in Tesla's production.

Tesla’s main resource is its intellectual property, namely its electric

powertrain, which consists of its battery pack, motor, gearbox, power electronics,
and control software. (Cleverism, 2016). Tesla had concentrated their efforts on
the following materials: lithium, nickel, cobalt, aluminum, silica, tin, tantalum,
tungsten, and gold (3TG). These materials provide the basis for Tesla's cutting-
edge battery technology and electric car manufacturing (Tesla, 2022).

Nearly 40% of the suppliers for materials used in Tesla's electric vehicle
batteries are Chinese companies. According to a review of Tesla's supply chain,
China was the top source of materials for the lithium-ion batteries used in its EVs,
accounting for 39% of the 61 businesses in the "storage battery" category.
(Nikkei, 2023).

2.1.3 The factors contributing to supply chain disruptions.

Tesla has been facing supply chain issues for over a year, including, the
huge shortage for semiconductors in 2021 – 2022 due to various reasons likes
pandemic, dramatic rises in some raw material costs, political scenario between
USA and China that affected the relationship of Taiwan and Chinese. This is

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because the major supply of semiconductors is coming from Taiwanese
companies, they got plants across China and Taiwan. Due to that, all the chip
manufacturers faced the issue of meeting the demand by the buyers and the Chips
are an integral part of technology driven cars. (Sujay, 2023). This have impacted
Tesla supply chain and manufacturing operations, according to the company.
(Kavya, 2022).

Besides that, due to labor and equipment shortages, transportation delays,

and the increasing price of lithium, a key raw material in the main batteries
currently used for electric vehicles and energy storage, solar and storage
developers across the country are experiencing project delays and cancellations.
As a result, storage developers have had difficulty obtaining lithium-ion batteries.
(Kavya, 2022).

Furthermore, Tesla's had heavy dependence on Chinese partners when it

comes to its requirement of material supply. Chinese companies that are vital
suppliers for Tesla included:

Chinese companies Material produced Fronteo’s '’’’score

Ganfeng Lithium Lithium 6.8
Novoray Inorganic 7.1
Zhejiang Huayou Cobalt Cobalt 5.7
Table 1: Fronteo’s “chokepoint score” index, sources by NikkeiAsia

Tesla's reliance on major suppliers was rated using Fronteo's "chokepoint

score" index, which measures the degree of a final product maker's dependence on
a specific supplier on a 10-point scale, with 10 representing the heaviest
dependence (Nikkei, 2023). This shows that the most essential material for EV
batteries (Barrera, 2022) is under influence of China government. Thus, heavy
dependence on Chinese suppliers entails risks. (Nikkei, 2023).

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2.1.4 The impact of raw material shortages on Tesla.

The impact of raw material shortages on Tesla's production and prices is

an issue that has received a lot of attention recently. Tesla's operations are highly
dependent on a consistent supply of essential raw materials as the largest
company in the electric vehicle industry, and any disruptions in this supply chain
can have far-reaching consequences, affecting not only their production output but
also their financial performance and the quality of their electric vehicles. In this
research, we will look at the various effects of raw material shortages on Tesla's
operations, and how these issues can affect the company's ability to reach
production objectives, control costs, and maintain the quality standards for which
it is known. (Isidore, 2021)

According to a comparison of its website on the Wayback Machine

internet archive, the Tesla raised their price of product. Due to this issues Elon
Musk, the CEO of Tesla had response to a Tesla fan's inquiry on Twitter, saying
that attributed of price increases for Tesla vehicles to external factors beyond the
company's control. He mentioned that these price hikes were a result of
widespread supply chain pressures and rising raw material costs affecting the
entire automotive industry. For instance, shortage and price increase of computer
chips, price of lithium has more than doubled in trading markets in 2021, and
cobalt that is also sharply higher though it has retreated from a high earlier in
2021. These mediums are several of key materials in EV batteries production.
(Isidore, 2021)

Subsequently, Tesla's dependency on Chinese suppliers rises significantly

in current global geopolitical location. According to Mari Yamamoto, a director at
Fronteo, the most concerning risk for Tesla is a potential supply chain break down
as the United States and China compete for global dominance. This failure might
make it more difficult for the American manufacturer to get critical components
like as batteries. As an instance of the consequences of this dependence, on
August 1, Beijing put export restrictions on gallium and germanium goods, both
of which are critical components in semiconductor manufacture. China, as the

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world's largest source of these materials, imposed these restrictions in reaction to
US-led limits on advanced semiconductor shipments to China, emphasizing the
unpredictable of such reliance. In this context, an EV manufacturer may
experience production difficulties if a key component supplier decides to
discontinue shipments to the manufacturer, highlighting the sensitivity of global
supply chains to geopolitical developments. (Nikkei, 2023).

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2.2 Labor aspects

2.2.1 Balancing economic consideration and job security at Tesla.

With regards to labor, Tesla has a strength of approximately 45,000

workforces. Job insecurity has also been making news lately as there has been an
increase in employee retrenchment. Such cost-cuttings may affect the image of
the company because it is possible to pay attention solely to the economic factor
of the triple bottom-line, but it will result in unsustainable supply chain
management mechanisms.

2.2.2 Overview of the labor situation at company Tesla.

The company brand, “Tesla”, is associated with production of electric cars

as well as the renewable energy solution. Additionally, tesla employed about 45
thousand people all over the world. There have been some challenges with regards
to labor relationship such as worker’s safety, working condition, and unionization
effort that the firm has experienced during its operations.

2.2.3 Overview of the current labor situation.

These require extreme scale for them to facilitate a shift away from fossil
fuels to humanity. These require extreme scale for them to facilitate a shift away
from fossil fuels to humanity. They have huge scales that will move humans off
fossil fuels. They have their headquarters located in Texas and these include six
large integrated manufacturing plants distributed across three continents. We
make everything we sell through our in-house team design, construction, sale, and
servicing. (Tesla, 2022)

As of December 31, 2022. For their employees and subsidy workers

around the world, they had grown by almost 128,000 and 29,000 personnel years
over the year. On the other hand, it works in construction mode with half of its
people in a manufacturing unit for the development of products. During a decade,

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he created more than 127 thousand labor positions. Thousands of jobs have been
already advertised at Gigafactory Texas and Gigafactory Berlin-Brandenburg.
(Tesla, 2022)

2.2.4 Recent staff lay-offs and the impact to staff

Such layoffs in fact are likely to erode the job security perception of the
workforce and create an uncertain atmosphere as a result. Many companies issue
formal comments or news releases explaining what these decisions mean for their
workers and why they have made them. (Tesla, 2022)

In 2017, Tesla let go of about 700 people after it suffered with the
production problems. After, ‘production bottlenecks’ on the Model 3 car, many of
the employees had faced layoffs. In a year’s time Tesla laid off about 80 of its
employees or approximately 9 percent. Those layoffs were due to a companywide
restructuring. The move is a bid by Tesla to increase profitability. These included
the elimination of many layers of management, downsizing communications and
streamlining so that the organization could respond quicker and be more efficient.
Among the staff, layoff focused on managers who were salaried while production
lines workers were spared as the company increased Model 3 output. (Tesla,
2022)

The company made the first round of layoff cuts in early 2019 and
followed that up with a 7% cut in staff in just seven months. The company made
the first round of layoff cuts in early 2019 and followed that up with a 7% cut in
staff in just seven months. As early as February 2019, Tesla terminated over 3500
employees, which translates into more than 7% of staff terminations, making this
the second round of layoff within a span of seven months. It had cuts in product
sale and delivering model S team and model X production teams.

In June 2022, Tesla reduced its workforce by 10% and enacted a freeze on
hiring. Musk said he began to see signs of the economy turning around. After
announcing that it intended to cut 10% of salaried staff, Tesla had laid off some

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employees following Elon musk’s “super bad feeling” about the economy.
Layoffs affected hundreds of Tesla workers, who included autopilot staff as the
EV maker dismantled a Californian hub. Tesla also paused hiring. In that very
summer, Musk got hardline with the Tesla work from home (WFH) policy and
told his top executives that they would have to come back to the office or else just
leave. (Graham Rapier, 2023)

A union alleged that Tesla had unlawfully dismissed workers. Besides,

there are few other leading car manufacturers in the USA whose employees are
not organized as labor unions except for Tesla. Tesla dismissed multiple
employees of its factory situated in Buffalo, New York, after the labor union of
Woker’s United revealed its plans for the creation. The union alleged that Tesla
had lawfully fired employees in retaliation for union activity with an intent of
deterring future union activity, but Tesla responded by saying that the fired
employees had been found wanting and hence their termination was warranted.
(Graham Rapier, 2023)

2.2.5 Potential impact of cost-cutting measures on Tesla's reputation.

The effect that cost cutting measures may have on the reputation of Tesla
will likely revolve around several aspects – how the firm portrays the move, the
necessity for the reductions, and the public perception of Tesla in general. (Fred
Lambert, 2019)

It is of much importance to know how Tesla communicates its cost-cutting

measures. Clarified announcements should be made regarding the grounds for the
cuts, anticipated advantages, as well as strategies for possible development in the
future can assist in counteracting damaging notions. The measures should also be
seen by employees and the public in good faith, as they are made to ensure the
company’s stability and development. (Fred Lambert, 2019)

The cost cutting program could be perceived as acceptable if Tesla

management considered these measures as necessary actions that would ensure

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Tesla’s competitiveness. Prudent financial management, directed towards
protecting the company’s future, might be appreciated by investors and
stakeholders. The image of Tesla’s CEO is largely Elon Musk’s. How he shares
and runs the cost-saving operation will largely influence public image. The way
peoples viewed the company has in the past, been influenced by Musk’s public
statement and attitude.

Overall, the impact on Tesla's reputation will depend on a combination of

these factors and how the company manages and communicates the cost-cutting
measures. Companies that are perceived as making strategic and necessary
decisions to ensure long-term success may weather the challenges more effective
than those whose actions are seen as reactive or detrimental to their core values.

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2.3 Battery safety and brake failure

2.3.1 Tesla's entry factor into China is problematic due to issues in the vehicle.

Nearly 28% of Tesla's market worth was lost in 2013 because of many
fires that broke out in its cars. Its battery is far from upholding public standards,
even though it has some advantages over other electric vehicles. Chinese
consumer confidence has dropped as a result, raising questions about Tesla's
quality control. Tesla automobiles essentially vanished from the public eye in the
years that followed until 2020. Chinese consumers made purchases after Tesla
released the Model S and Semi Model consecutively in 2020. Nonetheless, the
brake failure episode instantly dissuaded many prospective buyers from
purchasing a new Tesla production line. (Xinran Dai,2022).

2.3.2 Types of tesla batteries

How large do Tesla batteries come? It is true that not everyone can use
electric vehicle (EV) batteries. This is particularly true for Tesla, which is
currently among the best EV brands. Tesla uses four primary battery types. The
situation with other automakers' EV lineups is comparable. Throughout their
entire range of electric vehicles, Tesla offers four primary battery types: the
18650, 2170, 4680, and prismatic Tesla battery. These Tesla power banks are all
lithium-ion.

Only four battery types have been used in the company's nearly 20-year
history, including the Roadster, which ceased production in 2012. Every battery
has a distinct manufacturer of its own. There has never been a single manufacturer
of all four kinds of Tesla car batteries. However, this may give the impression that
things are more difficult than they are. You see, the real value of a real battery lies
in what it can do for the electric vehicle (EV), even for someone like Elon Musk
who is devoted to total control over the manufacturing process. (Nate
Williams,2023).

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2.3.3 Factors leading unsafe Tesla batteries

Electric vehicle manufacturers face a problem with battery fire, though it's
hard to say how significant of a problem that is. The car's novelty attracted intense
media attention to industry happenings, which would have made EV-related issues
at Tesla or General Motors appear worse. Investors require context. The CEO of
Tesla, Elon Musk, backed the endeavor to make it accessible. According to one
report, there have been fires in 0.01% of Tesla vehicles on the road-fewer than in
the entire auto industry. It appears that he thinks electric vehicles could have a
negative reputation. (Al Root,2021).

The use of lithium-ion batteries is one of the factors contributing to fire

incidents and the risk that Tesla faces. Battery packs for electric vehicles are made
up of thousands of tiny lithium-ion cells. The cells are connected to battery packs
made of extremely durable materials like titanium, which are typically fastened to
the underside of the car. The goal is to make it nearly impossible to access the
battery and, ideally, shield it from even the most severe collisions. Not everything
goes according to plan. A short circuit can occur in one or more lithium-ion cells
when an EV battery is harmed or just fails internally, heating the battery. At that
moment, a highly flammable liquid electrolyte is revealed by a tiny membrane
that divides the cathode from the liquid anode. (Rebecca Heilweil,2023).

Moreover, if the battery sustains damage from an impact, water damage,

or other sources, the temperature of the cell will start to rise quickly. This can lead
to an increase in the temperature of subsequent cells, a phenomenon known as
heat escape, and ultimately result in a fire. This cellular dispersion may
occasionally stop within the battery. (Greg,2020).

Furthermore, the primary drawback of the chemistry of lithium-ion

batteries is that individual cell overcharging is the primary cause of the battery
pack fire. The fact that even a single damaged cell can allow heat to escape means
that manufacturing disruptions can contribute to fires. Most incidents also happen
while the car is charging fully, so the state of the vehicle may also play a role in
this fire. (Greg,2020).

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2.3.4 The problem of Tesla brake failure has put drivers in danger.

Phantom braking on Tesla cars has always been a problem. The National
Highway Traffic Safety Administration began looking into "Unexpected Brake
Activation" in Model 3 and Model Y cars from 2021 and 2022 in February 2022.
354 complaints about the problem had been filed with NHTSA at that time. After
a period of three months, there were 758 complaints regarding phantom braking.
According to KGW's analysis of more recent data, the NHTSA has received a
noticeably higher volume of complaints. In those same years and models of Tesla
cars, there have been 815 more reports of unexpected braking through
September. (Kyle Iboshi,2023).

2.3.5 Tesla has serious problems with their brake.

Consumer Reports tested multiple Tesla Model 3s and found significant

issues with their braking distance. Consequently, they declined to recommend the
Model 3s. According to my colleague Mark Matousek, a Tesla representative told
business insider the company recorded an average stopping distance of 60 mph
133 feet and said the stop distance results may vary based on the range Factors.
Consumer Reports stated that it took 152 feet for the vehicle to come to a
complete stop, which is "much worse than any contemporary car we have tested."
Thus, it is simple to believe that the infotainment system or the motor system are
the most crucial components of the car, but the tires and brakes are the most
crucial components of all. At that point, the road is practically filled with rubber.
(Matthew Debord,2018).

2.3.6 Tesla Impact on unsafe batteries and brake failure

A lot of information about the various cases that tesla users go through
including brake failure (19.85%, n = 2666), accident (14.18%, n = 1904), and
crisis (3.2%, n = 430). This has had a huge impact on large users due to unsafe
batteries and brake failures. (Jiajun Liu,2022).

18
 Tesla's failure to address this problem has led to an increase in adverse
events against tesla users. Among them are accidents due to brake failure, a fire
that occurs because of a battery that fails to function properly. All this has caused
users to be dissatisfied with tesla for not meeting needs and requirements of
consumers.

The incident against the unsafe battery has caused a fire and it has left
consumers distrustful of Tesla because the products provided are unsafe and have
affected Tesla's profitability due to the lack of buyers. Meanwhile, the brake
failure that caused the accident also affected the image of the Tesla and its
performance due to failure to protect the safety of the user. This will cause
consumer dissatisfaction with Tesla.

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2.4 Low adaptability

2.4.1 The crowded metropolitan roadways of cities restrict the high performance
of Tesla vehicles.

Superior handling, grip, and steering is all part of its potent performance.
In China’s crowded metropolitan road network, these skills are noticeable only in
long distance driving. It is evident that the manufacturer did not account for the
distinctions between Chinese urban areas and their western counterparts. Many
Chinese consumers will choose to purchase alternative brands of new energy
vehicles due to the high costs Tesla cars. Next is compared to Chinese new energy
vehicles, Tesla cars have a simpler and less ostentatious appearance. Most of the
China’s new energy vehicle buyers are younger generations who are more
accustomed to new. (ICSSED, 2022)

2.4.2 Types of adaptability

The capacity to cope with complexity and uncertainty as well as to adapt

to changing circumstances is known as adaptability, as a pioneer in the electric
vehicle sectors, Tesla has proven its ability to adapt both its operations and its
product in many ways. One example of a product that is designed to adapt to
various user preferences, driving circumstances and software upgrades is Tesla’s
automobile. For example, the cabin of Tesla’s model 3 is simple and contains a
single touchscreen that the driver may customize to display different features and
functions. (Nathan fur, 2022)

Process adaptability comes next, like Tesla’s manufacturing is also flexible

enough to take advantage of various chances and problems. For instance,
depending on the intricacy and productivity of the work, Tesla has experimented
with varying degrees of automation and human engagement in its production
lines. To combat the COVID-19 epidemic, Tesla has also modified its
manufacturing method. It has added safety precautions, switched to online sales,
and started manufacturing ventilators using its spare components. In addition,

20
Tesla has built local factories and customized its product to meet local laws and
consumer preferences to adapts its production method to other markets, like China
and Germany.

Finally, strategic felicity allows Tesla’s overarching plan to be adjusted to

various innovative and competitive situations. For example, Tesla changed its
strategy to concentrate on mass-market cheap automobiles, such the model 3 and
the impending model Y, instead of high-end luxury vehicles. Along with changing
its focus from being a carmaker, Tesla is now a diversified energy firm that sells
solar panels, batteries and charging stations, among other goods and services.
Furthermore, by disclosing its patent and forming industry alliances, Tesla has
changed its business model from one that was exclusive and closed off to one that
is more transparent and cooperative. (Nathan fur, 2022)

2.4.3 Factors of low adaptability

Adaptive intelligence, both humans and other sentient species have

evolved to withstand a dynamic environment. They are therefore exceptionally
adept at handling unforeseen circumstances and differences between anticipated
and real happenings. Many factors go into human intelligence like our ability to
attend to the right things at the same time, to reason about them, to build models
of what's going on to anticipate what might happen next and so forth. Conversely,
machine learning is still lagging human intelligence and flexibility.

They have come a long way but these days, sophisticated AI algorithms
that draw inspiration from neurological systems are even more adept than humans
in identifying similar scenarios, such as a traffic light changing to red or a ball
dropping down the pavement. New soft material robots can now physically adapt
to unexpected items in their physical surrounding thanks to advancement in
robotics. However, flexibility is constrained to changes within a narrow range of
items or occasions in both situations. (Bettina Bushel, 2018).

21
 Full automation is Musk has stated in the open that he wants to build a
plant that is completely self-sufficient. His ultimate objective is to outpace the
speed of humankind. Higher outputs are achievable at faster speeds. However, in
complex contexts like highly automated factories, highly adaptive robots are
required, able to react to unexpected events and to one another like biological
systems do. More research is needed to introduce that kind of biological
robustness in robotics and AI. In the first, a predetermined set of processes such as
selecting raw materials and arranging them on an assembly line, are tested for
robotic automation. The second is extending that test to additional roles and
procedures, such as combining the raw material and packaging the product. The
third stage is to deploy robotic co-workers and adaptive AI as human assistants.
(Bettina Bushel, 2018)

Some factors that could potentially impact the adaptability of Tesla

vehicles include limitations in their software or hardware capabilities. For
example, if the sensors or cameras on the vehicles are not able to accurately detect
certain road conditions or obstacles, it could affect their ability to adapt to those
situations. Additionally, if the software algorithms that govern autonomous
driving or other features are not optimized for certain scenarios, it could also
impact adaptability. However, it's important to note that Tesla is constantly
working on improving their technology and addressing any limitations to enhance
the adaptability of their vehicles.

22
3. SOLUTION FROM TESLA TO THE INITIAL PROBLEMS
3.1 Solution to mitigate and manage raw material shortages effectively.

To address this problem, the company has actively sought materials from more
than one supplier or region and is continuing to explore the availability of materials in
new regions so that it can effectively and efficiently meet its consumer demand. (Sun,
2016). Elon Musk has stated that the goal is to have one manufacturing facility for each
continent to meet consumer demand. They aiming to acquire raw materials like as lithium
and nickel locally in North America for its production facilities in the United States, and
there are plans in the works to establish a cathode factory in the United States. Tesla has
detected lithium clay sources in the United States and is exploring ways to extract lithium
from these reserves. (Sujay, 2023).

Thus, by cooperating with four separate cell manufacturers, each of which offers
three distinct battery chemistries, the company maintains a stable supply chain. This
variety not only increase in product lines of strengthens Tesla's durability, but also allows
for advances in electric car performance and energy storage options. (Tesla, 2022).

During the semiconductor shortages, Tesla conducted experiments with

developing semiconductors applying new material technology Silicon Carbide (SiC)
rather than standard Silicon Wafer technology. Silicon is substantially more energy
efficient and durable, and its greater thermal conductivity reduces energy loss by 50%.
Tesla has also advanced battery technology by lowering the use of lithium. This help
Tesla to reduce their dependency in lithium. (Sujay, 2023)

As Tesla works to develop environmentally friendly and efficient electric

vehicles, the transparency and reliability of its supply chain are essential components in
maintaining public trust and assuring the long-term sustainability of its products.
Consumers and the industry are keeping a close eye on the company's commitment to
tackling these sustainability concerns, as it plays an important part in determining the
future of electric mobility. (Sun, 2016)

23
3.2 Solution to improves staff layoff in Tesla company.

It's important for companies to approach staff layoffs with empathy and a focus on
supporting affected employees during a challenging time. Legal and ethical
considerations should also be considered throughout the process. Companies may want to
consult with legal and HR professionals to ensure compliance with relevant regulations
and to develop a strategy that aligns with their values and goals. (Tesla,2022)

Thus, providing employee feedback and adopting transparent communication are

some of the imperative aspects when handling a challenging issue such as staff
redundancy in an organization. It’s important to make ways for useful feedback in matters
relating to employees. Using surveys, interviews, and town hall meetings as vehicles for
employees to express freely, their experiences, worries and recommendations. For
example, when dealing with more sensitive issues, such as layoff, it would be much more
beneficial to use anonymous feedback mechanisms such as surveys and suggestion boxes.
Setting up open forums for constant reviews, as well as appointing employee reps
through which their colleagues’ issues will be channeled also strengthens this linkage
with management. To make any feedback from employees meaningful, an organization
must pledge to do something with such information, which will create a collaborative and
responsive environment within such organization. (Graham Rapier,2023)

Moreover, transparent communication demands truthfulness, clear language, and

swift messages. Layoff decisions should clearly explain why there are job cuts, avoid
ambiguous language concerning the future and provide timely information to rebuild trust
among employees and reduce uncertainty concerning the future. Leadership should be
accessible; leaders must be available to answer any questions or address any concerns,
through many channels. This shows that management is aware of how layoff affects not
only the affected, but also the staying ones due to its ripple effect throughout the
organization. Transparent communication demands that there are channels of clear
communication, there is consistency in messaging, and there exists a feedback system. In
situations where there is a need to downsize, communication of the tough. decision but of
the available supporting structures like the Employee Assistance Programmed (EAPs)
and Counseling Services is highly recommended. (Fred Lambert,2029)

24
3.3 Solutions in overhauling battery safety and brake failure

One of the primary barriers to the widespread adoption of electric vehicles (EVs)
is the limitations of battery technology. The weak energy density of EV batteries
currently in use has an impact on the vehicle's driving range. Over time, different battery
combinations and technologies have been developed to increase the efficiency of electric
vehicles. This is because it will be better, more reasonably priced, and larger-capacity
batteries will increase vehicle autonomy, consumers view electric vehicles as a viable
alternative to internal combustion engine vehicles. Tesla needs to produce better and
more reasonably priced batteries because they are crucial for electric vehicles. (Fayez
Alanazi, 2023)
Other than that, Tesla needs to make its batteries more durable. One of the key
factors supporting Tesla's growth in the Chinese market is the new energy vehicles'
exceptional battery longevity. In the Chinese market, new energy electric vehicles
currently have a 300 km range, which is far less than that of conventional fossil fuel
vehicles. Customers are hesitant to purchase a new energy vehicle as a result.
Consequently, by extending the battery life of its cars and helping the industry to raise
standards, Tesla was able to maintain its competitiveness and market position. (Xinran
Dai, 2022).
Lastly, to prevent a lot of collisions or accidents, Tesla needs to make sure the
brake system it has designed is an advanced. Making sure the braking system can lower
the risk of accidents is essential. To make driving safer, Tesla must also develop an
embedded art system that can create a safer braking system on cars. The developed smart
brake model needs to respond with accuracy and efficiency. The ideal way to handle this
kind of electric vehicle safety concern is with the suggested smart braking system. User
safety will be enhanced by a continuous vehicle barrier monitoring system equipped with
an intelligent brake module. (Patil Lalit, 2022)

25
3.4 Solution to improve their adaptability.

To improve their adaptability, with an advanced features and technologies that

enable them to adapt to different driving conditions. However, if looking for ways to
enhance the adaptability of Tesla’s technology in the future, it's always possible for tesla
to continue innovating and updating their software to further improve adaptability. This
could include refining their autonomous driving capabilities, enhancing sensors and
cameras for better detection or even integrating more advanced AI algorithms. Tesla’s
commitment to continuous improvement means that they will likely find ways to enhance
adaptability even further in the future. (Mack Hogan, 2021)

Tesla also expanding the use of human labor in the production process,
particularly for jobs requiring adaptability, inventiveness and problem-solving abilities
regarding handling exceptions, quality control and feedback, humans can be an asset to
that machine. Next, they determine the ideal degree of integration between automation
and human intervention while weighing the advantages and disadvantages of automation
in addition to considering human factors like aptitude, drive and contentment. Lastly, is
creating more resilient and adaptive AI systems that can handle change and uncertainty
and learn from data and experience. Techniques like reinforcement and evaluation
algorithms can be used to do this.

26
 4. CONCLUSION

Lastly, this study explored what it feels like for Tesla that is currently the key player
pushing towards a green transport sector. Therefore, as a pioneer in the EV marketing, it is
crucial that Tesla not only addresses these issues but can change how the whole EV industry
operates as well. Solving these challenges will help Tesla improve its operation, make better
strategic choices, and remain competitive leader in the clean transport field.

This research would have far reached implications beyond those of Tesla as an
organization. These results could provide the basis for further understanding the impact of the
changes on the global electric vehicle industry in terms of the manufacturing practices, safety
measures, and the extent to which the vehicles in question are adaptable. This study uses
sustainability lens with an aim to change automobile industry and reduce emissions. These can
fuel not only further success of Tesla but will also spur necessary societal change of greener
transportations.

Additionally, their findings can have significant impact on government’s policies relating
to EV production, safety standards, and public adaptation. With regards to this study, it becomes
a catalyst of partnership among companies within the industry, regulators, and the community at
large. However, in the end, it will lead to an improved environment that makes the electric
vehicle industry to grow, benefiting not only the company but also the society by promoting a
green and sustainable world. Essentially, this study paves way for surmounting hurdles,
advancing creative practices, and ushering the electric vehicle market into an age of
sustainability and competency.

27
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6. APPENDIX

Diagram 1: Tesla’s battery raw material, sources by Tesla

Diagram 2: Total global employee count sources by Tesla

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Diagram 3: Tesla car has reportedly caught fire in China, source by news south China morning
post

33