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How should Tesla recycle its own batteries? Should they opt for organic development, acquisition, partnership, or some combination of these? What are the benefits and tradeoffs of each decision? Tesla should model their recycling process after Toyota and Volkswagen, where both companies repurpose their batteries for energy storage system use in various areas, such as residential energy and grid-scales. This is an example of partnership, which can be convenient and less wasteful, but also may not account for the market not being able to adequately meet Tesla's energy waste supply. Organically growing this process runs the risk of not learning from other firms and instead starting from scratch. which leaves rooms for error and overly ambitious goals that may not be achievable in actuality. Acquisition is a convenient option and allows firms to outsource this service, but also may run into the issue of smaller companies, which are bought up, not being able to adequately meet the firm's needs.
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What are the pressures internal and external to the company that Tesla faces to recycle its batteries? Tesla faces internal pressure from investors to recycle its battery due to the now common belief that climate change issues will inherently affect businesses, therefore they should play a role in mitigating its impacts. They also face external pressures from NGOs who monitor their environmental actions and issue ratings on their sustainability efforts, such as the Task Force on Climate-Related Financial Disclosures (TCFD).
- How should the protagonist (Teresa Maddux) package and present her decision to Elon Musk? What are the issues that he is most likely to care about and how will he be swayed? Maddux should frame her decision as an important investment in the future as Tesla, as business cannot reliably operate on a damaged planet. Musk would most likely care about this issue of cost and funding this initiative, for which Maddux could respond that they could sell the old batteries to residential areas or grid-scale systems for repurposed use and that, overall, this will ultimately help the planet which they need in good health to produce items and generally operate the firm.
- What impacts will adopting a recycling program have on the critical mineral (lithium, cobalt, nickel) supply chain of which Tesla is such a major downstream customer? Since the supply chains of these minerals often struggle to keep up with the Tesla demand, recycling them may aid them in repurposing efforts which keep them in circulation longer.
- What impact would Tesla's decision have on the rest of the electric vehicle industry? Would other companies choose to follow Tesla's path? Tesla recycling its batteries could influence other firms to also follow in their footsteps and even partnership with Tesla as a way to expand the initiative. It would also demonstrate to other firms that recycling batteries is a worth-while effort for the industry as a whole.
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hbsp.harvard.edu hbsp.harvard.edu
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originally used lithium ion batteries (LIB)
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