Ford, GM May Take A Leaf from Elon Musk's Tesla Playbook For Success: Fewer Options, More Profit

Legacy automakers may reduce customization options, taking cues from Tesla and Chinese EV firms, reports Business Insider.

American and German car buyers have traditionally enjoyed a plethora of customization options. However, Elon Musk‘s Tesla Inc TSLA and Chinese automakers have streamlined their offerings, resulting in operational ease and market success.

The more customization an automaker offers, the more intricate its assembly process becomes. Simplifying build options reduces complexity and enhances efficiency.

Ford F and GM GM are already noting these market shifts. Ford’s CEO, Jim Farley, mentioned a potential 80%-90% reduction in consumer options, while GM’s CEO, Mary Barra, discussed a strategy to reduce design and engineering complexities. Other automakers like Mercedes-Benz and Subaru have also adopted similar strategies.

“Managing build combinations and complexity is a high-wire act that requires a keen eye on customer preference,” Brian Irwin, from Alvarez and Marsal’s automotive consulting group.

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